Nvidia's latest earnings led many analysts to raise their estimates on the chipmaker. Here's what they had to say

Nvidia reported second-quarter adjusted earnings of $1.05 per share on $46.74 billion in revenue, exceeding analyst estimates, and provided strong guidance for the current period. Despite a slight pre-market share dip due to data center revenue missing expectations for the second consecutive quarter, Wall Street analysts remain overwhelmingly bullish, with many raising price targets. Analysts cite robust demand signals for Hopper and Blackwell, an accelerating Blackwell ramp-up, and Nvidia's continued dominance in the multi-year AI infrastructure spending growth cycle, emphasizing the company's strong execution and resilient long-term outlook, with an average price target suggesting over 8.5% potential upside.

Analysis

Nvidia reported second-quarter results that surpassed consensus estimates, with adjusted EPS of $1.05 on revenue of $46.74 billion, and provided guidance for the current period that also beat expectations. Despite this, the stock experienced a minor pre-market dip of 1.9%, attributed to data center revenue disappointing for the second consecutive quarter. However, the overarching Wall Street sentiment remains exceptionally bullish, with 58 of 65 analysts tracked by LSEG rating the stock a buy or strong buy and many, including JPMorgan and Citi, raising price targets. The consensus rationale is that the long-term thesis is firmly intact, driven by what analysts describe as "rock solid" demand for the Hopper and Blackwell chip platforms. Key positives highlighted include an accelerating Blackwell ramp that alleviates supply chain concerns, and management's resilient long-term outlook which endorses a 50% growth view for next year and a potential AI infrastructure Total Addressable Market (TAM) of $3-4 trillion by 2030. While some analysts like Goldman Sachs noted the results were merely "in-line" against elevated expectations, the competitive moat created by Nvidia's CUDA software stack and its valuation of 32x forward P/E—slightly below its peer average of 34x—are cited as reasons for continued conviction.

Key Decisions for Investors

• Investors should consider looking past the minor short-term data center revenue miss, focusing instead on the intact multi-year growth narrative supported by overwhelming analyst conviction and strong management guidance.
• It is prudent to monitor the execution and acceleration of the Blackwell product ramp, as this is a key catalyst for near-term performance and is seen by analysts as a sign of robust core fundamentals.
• Given the stock's significant run-up and its ~8% weight in the S&P 500, investors should be mindful of the high expectations priced in, though the current forward P/E multiple of 32x is viewed as reasonable relative to peers.
• Consider the potential for upside surprises to revenue from factors not included in guidance, such as the $2-$5 billion quarterly opportunity from licensed sales to select China customers mentioned by Citi.