Chip designer NVIDIA Corporation is facing challenges in maintaining its GPU pricing power, according to a new report from HSBC. The investment bank has reduced NVIDIA’s share price target from $175 to $120 and downgraded its rating from Buy to Hold. Historically, NVIDIA’s GPU prices have been driven by its technological edge, supply constraints, and high manufacturing costs, shaping the company’s market position and stock value. However, concerns over future demand, particularly following efficiency claims by Chinese AI startup DeepSeek, triggered a major selloff in January, erasing nearly $600 billion from NVIDIA’s market capitalization.
HSBC Sees Limited Pricing Gains for NVIDIA’s B200 & B300 Blackwell AI GPUs
NVIDIA has been one of the worst-performing stocks in 2025, with year-to-date losses of 24%. The stock also declined 4.9% at market open today due to fresh tariffs imposed by the Trump administration, which have unsettled both U.S. and global markets. Amid these challenges, HSBC analysts suggest that NVIDIA’s pricing power for AI GPUs is weakening.
Frank Lee, an HSBC analyst, analyzed the pricing trends of NVIDIA’s latest Blackwell AI GPUs, the B200 and B300, as well as the GB200 and GB300 NVL72 server racks. Despite being built on TSMC’s N4P manufacturing process, the B300 GPUs have not shown a significant increase in average selling price (ASP) over their B200 predecessors. “We have seen no significant ASP boost between B200 and B300 GPU or the GB200 and GB300 NVL72 rack architecture,” noted Lee. Additionally, upgrades in GPU specifications appear to be minimal, with most advancements expected in next-generation Vera Rubin GPUs featuring HBM4 memory.
HSBC further predicts that NVIDIA’s systems will continue to support 72 GPUs per rack until 2027, when the Rubin Ultra series is expected to launch. Given these findings, the bank downgraded NVIDIA’s stock rating to Hold, just as the company’s shares extended their losses to 5.34% in early trading today.
NVIDIA CEO Defends Pricing Amid Market Challenges
HSBC’s report follows recent comments by NVIDIA CEO Jensen Huang, who defended the company’s GPU pricing during an interview after the GTC conference. Huang emphasized that NVIDIA’s GPUs enable users to generate and save money through efficiency gains. He also attributed high prices to manufacturing complexities and noted that NVIDIA is collaborating with TSMC and Foxconn to establish domestic production facilities in the U.S.
Despite these efforts, NVIDIA remains vulnerable to geopolitical and regulatory pressures. The latest round of U.S. tariffs has excluded NVIDIA, and the company is reportedly lobbying for policy changes to ease restrictions on AI GPU sales. Currently, U.S. regulations limit unrestricted AI GPU sales to only 18 key allied nations, further complicating NVIDIA’s market outlook.