B200 Rental Rates Soar 30%, Defying Bear Case on Nvidia

Nvidia's B200 rental rates have surged by 30% year-to-date, defying expectations that AI token prices would drop and GPU rents would follow suit.

This development is seen as a challenge to the bear case on Nvidia, which hinges on the idea that cheaper AI tokens would lead to lower GPU rents and subsequently smaller returns on Nvidia's hardware investments.

In contrast, rising rental rates suggest that companies are willing to pay more for Nvidia's chips, indicating strong demand and pricing power for the company.

Nvidia's gross margin has held up well, reaching 75% in fiscal 2025 and slipping only slightly to around 71% last year. Analysts expect revenue to nearly double to about $412 billion this fiscal year, with estimates pointing to a peak of roughly $893 billion by fiscal 2029.