Nvidia Stock Edges Up. Foxconn Has Good News on AI Server Demand.

Nvidia and Foxconn are partnering on multiple projects. (Photo by I-HWA CHENG/AFP via Getty Images)

Nvidia stock inched up Thursday as its partner Foxconn sent more signs of strong demand for artificial-intelligence infrastructure.

Shares were up 0.4% at $182.12. The stock fell 0.9% on Wednesday and seems unlikely to move significantly before the company’s earnings report on Aug. 27.

On Wednesday, Nvidia pushed back against an analyst report suggesting it is delaying the production of its next-generation Rubin hardware to better match chips from rival Advanced Micro Devices.

In an statement, Nvidia said the report was incorrect and Rubin remains on track.

Nvidia and Taiwan-based Foxconn, formally known as Hon Hai Precision Industry, are partners on several projects. Foxconn, while the primary contract manufacturer for Apple, has an increasingly large business in AI infrastructure—particularly servers housing Nvidia chips.

On Thursday, Foxconn aid cloud and networking products—including AI servers—accounted for 41% of its second-quarter revenue, overtaking smart consumer electronics as its biggest business. The company is projecting more than 170% growth in revenue from AI servers in the current quarter.

Also in the current quarter, AI “rack shipments [are] growing threefold quarter-over-quarter, reflecting continued strong demand from customers and stable production optimization,” Foxconn executive Kathy Yang said in a statement.

The GB200/GB300 NVL72 are Nvidia’s current AI rack servers, which incorporate 72 GPUs linked together inside one server rack. Each server costs several million dollars.

AI servers are growing at a 14% compound annual growth rate through to 2029, according to Mizuho analysts led by Vijay Rakesh. He raised his target price on Nvidia to $205 from $192 in a research note Thursday.

Among other chip makers, Advanced Micro Devices was falling 1.2% and Broadcom was up 1% in morning trading.

Write to Adam Clark at adam.clark@barrons.com