Nvidia shares bumped higher in late-morning Tuesday trading, and edged into positive territory for the year, following a bullish note on Blackwell chip demand heading into the AI market leader’s fiscal-fourth-quarter earnings next month.
The Santa Clara, Calif., group’s shares have largely underperformed the broader tech market over the past three months, falling around 3.4% and trailing the 6% advance for the Nasdaq. The market move comes amid concern about the impact of U.S. export restrictions on chip sales to China and reports of delayed orders for its new Blackwell processors tied to performance issues.
Blackwell, launched last year, is seen as a crucial revenue driver for the group over the coming years. That’s as hyperscalers such as Microsoft, Meta Platforms and Google parent Alphabet ramp up data-center spending and roll out their AI-powered offerings to clients while infusing their in-house product lines.
The Information reported last week that the first shipments of so-called Blackwell racks — which stack the new chips in a way that increases computing power with less energy and more efficiency — have been prone to overheating and glitching.
Nvidia has said Blackwell demand will likely drive revenues beyond the group’s estimate of “several billion dollars” this quarter.
That’s raised some concern that Nvidia’s transition from its Hopper sales, which predate Blackwell, could be delayed into the second half as the Blackwell technical issues are addressed.
Nvidia’s Blackwell sales strengthening: analyst
New rules unveiled in the final weeks of the Biden administration, meanwhile, will limit exports of AI technologies to some countries, including Singapore, Israel, Saudi Arabia and the United Arab Emirates, while maintaining outright bans on sales to Russia, Iran, China and North Korea.
Nvidia which generates around 30% of its revenue from Taiwan and China, called the complicated new rules a “regulatory morass” and accused the Biden administration of “undermining America’s leadership” in AI technologies.
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UBS analyst Timothy Arcuri, however, sees Blackwell sales improving notably in Nvidia’s current quarter, which ends in January, and rising into the coming financial year and beyond.
“We believe Blackwell chipset/compute board yields have improved, with a rapid shift in mix from Hopper to Blackwell in fiscal Q4 (January) and fiscal Q1 (April),” Arcuri said in a note published Tuesday. He reiterated his $185 price target on the shares.
The analyst also cited record earnings from Foxconn, the world’s biggest contract electronics maker and a key Nvidia supplier, as supporting the case for accelerated B200 and GB200 Blackwell shipments.
Foxconn results bullish for Nvidia
Earlier this month, Foxconn, formally Hon Hai Precision Industry, reported record fourth-quarter revenue of $64.7 billion. It said current quarter revenue would likely show “significant growth” from the year-ago period.
“As a result, we now see Blackwell revenue at around $9 billion in the January quarter vs. around $5 billion previously, but we believe Hopper will be down,” Arcuri said.
That leaves Nvidia likely to post overall fourth-quarter revenue of around $42 billion, Arcuri estimates, and $47 billion over the three months ending in April.
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Nvidia, which guides investors on revenue and profit forecasts for only the coming quarter, sees an end-January revenue tally of $37.5 billion, with analysts pegging its data-center total for fiscal 2025 at $113.36 billion.
For its Blackwell processors alone, Wall Street analysts expect several billion of revenue in Nvidia’s fourth quarter, with totals of $62 billion in 2025 and $97 billion in 2026.
Nvidia shares were last marked 0.74% higher in midday trading, changing hands at $138.89 each.
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