Memory Costs Rise: Can NVIDIA Protect Its 70%+ Gross Margin?

NVIDIA's gross margins are expected to decline from 75% in Q2 FY2027 to 71%-72% in Q4 due to rising memory costs driven by AI infrastructure demand. However, the company's strong pricing power, Blackwell demand, and supplier relationships position it to maintain margins above 70%. Competitors AMD and Intel face similar cost pressures but with lower margin cushions.