Underappreciated New Narrative for Nvidia: "Self-Developed Open-Source Models" and "Supply Chain Lock-In"

HSBC believes that Nvidia's strong bet on open-source small language models (SLMs), guiding millions of developers to run AI applications on its hardware through a free, optimized ecosystem, expands its customer base from a few cloud giants to a broader ecosystem; and that locking in capacity through multi-year agreements systematically puts competitors at a supply chain disadvantage. These two narrative threads are expected to become key catalysts driving a repricing of its valuation.