The other day I wrote that I thought the NVDA’s DGX-1 with 8 V100 GPUs had a margin of 95%. In reading through the article (link above), I learned that the margins are lower than that. The list price is $149,000, and, on the conference call, Huang said “the price of Volta is driven by the fact that, of course, the manufacturing cost is quite extraordinary. These are expensive things to go and design. The manufacturing cost itself, you guys can estimate it, is probably in the several hundred dollars to close to $1,000”. Now, I had calculated $149K divided by 8 to get the list price of each Volta giving a gross margin of 95% if the cost is about $1000. However, in reading the article is seems that part of the price of the DGX-1 is a software subscription (about $35K of the $149K) which I presume is for one year. While this means that the margin for the hardware is a little lower (93% compared to 95%), about 15% of each DGX-1 sale would be recurring if the customers renew service and support every year.
The article also discusses the cost per computing power improvement over the prior generation GPU from NVDA.