Nvidia’s Indonesian Mega-Campus and Plummeting GPU Rental Rates Tell Two Sides of the AI Story

Nvidia posted record $81.6B revenue but stock near 2-month lows as B200 GPU rental rates collapse 31%, signaling oversupply. Export restrictions and Chinese market loss add pressure.

Nvidia just posted a record revenue quarter that would make any other semiconductor company envious. Yet its stock is trading near two-month lows, down around 16 percent from its 52-week high of €202.50, and a fresh data point is giving the market pause: the hourly rental rate for its flagship B200 GPU collapsed 31 percent in just three weeks.

Between May 30 and June 21, the cost to rent a B200 accelerator slid from $6.11 to $4.22. That is not a minor fluctuation. Declining rental prices suggest cloud infrastructure is being built faster than new AI workloads can absorb it, eating into Nvidia’s pricing power. Analysts at D.A. Davidson, including Gil Luria, have argued that both Nvidia and Micron are already being priced as if the AI investment cycle has peaked.

The disconnect between Nvidia’s financial performance and its share price is striking. For the first quarter of fiscal 2027, revenue hit $81.6 billion, up 85 percent year over year. The data center segment alone generated $75.2 billion, well above the $73.5 billion consensus. Management guided for $91 billion in the current quarter, boosted a quarterly dividend to $0.25 per share, and authorised an $80 billion share repurchase program. Yet on the day after the May 20 earnings release, the stock fell 1.77 percent and has not recovered.

Part of the market’s caution stems from deepening export restrictions. In early June 2026, the US Department of Commerce closed a loophole that had allowed Chinese AI firms to obtain Nvidia’s Rubin- and Blackwell-series chips through offshore subsidiaries. JPMorgan and Bernstein estimate the cumulative revenue impact from export controls and Chinese competition at between $5.5 billion and $16 billion over the current fiscal cycle. China’s contribution to Nvidia’s data center revenue has effectively dropped to zero.

Nvidia is responding by building demand pipelines beyond restricted markets. One of its most ambitious moves is a partnership with the Australian AI infrastructure company Firmus Technologies, a $5.5 billion firm that is co-developing a 360-megawatt data center campus on the Indonesian island of Batam, just south of Singapore. The facility is scheduled to begin operations in the first quarter of 2027. Under a revenue-sharing and credit arrangement, Firmus will gain access to up to 170,000 Nvidia accelerators by 2028, including Vera Rubin, Grace Blackwell, and Vera platform chips. Nvidia will receive both standard product revenue and a cut of the platform’s cloud income. Firmus expects to secure $25 billion to $30 billion in offtake contracts over the first six years.

That deal underscores how Nvidia is trying to lock in long-term demand even as short-term GPU pricing comes under pressure. But the immediate market environment remains fragile. While Micron has nearly tripled this year and AMD roughly doubled, Nvidia has managed only a mid-single-digit gain. The VanEck Semiconductor ETF has far outpaced it, as investors rotate into memory and infrastructure plays that benefit from the later stages of AI buildout.

Wall Street is not abandoning Nvidia. Of the 61 analysts covering the stock, 48 rate it a buy, ten an outperform, and only one recommends selling. The median price target has climbed from roughly $269 in April to about $300 in June. Still, the stock’s technical picture is weak: the relative strength index sits at 40.9, and shares trade about 6 percent below their 50-day moving average.

The next major catalyst is the Vera Rubin chip generation, scheduled to enter production in the second half of 2026. AWS, Google Cloud, Microsoft Azure, and CoreWeave are already lined up as early adopters. Nvidia has also deepened its partnership with SK hynix to develop memory solutions for AI supercomputers, AI PCs, and robotics platforms.

Whether the Batam project and Vera Rubin can reverse the stock’s trajectory will depend on two things: stabilisation of GPU rental rates and the pace at which the $25 billion to $30 billion in Indonesian offtake converts into actual revenue. For now, the market is betting that Nvidia’s best days are behind it, even as its own numbers suggest the AI cycle is far from over.