Nvidia delivery delays to weigh on Applied Digital’s earnings

Applied Digital lowered its full-year expectations on Tuesday, blaming a tight supply of sought-after networking components made by chipmaker Nvidia, sending shares of the data center service provider plunging nearly 23%.

The company is grappling with delayed deliveries of some parts, including Nvidia’s InfiniBand, which works like an ethernet cable, linking clusters of chips across servers.

InfiniBand enables AI computing. Demand for Nvidia’s AI chips and accompanying tech has far outweighed supply as companies rush to adopt generative AI.