Barclays lifts Nvidia target to $200 as supply chain checks signal upside

Barclays raised its price target on Nvidia to $200 from $170, implying a 38% upside, citing robust supply chain checks indicating approximately $2 billion in upside for July versus consensus estimates. The firm increased its full-year Compute revenue estimate to $37 billion, driven by healthy utilizations and positive supply chain outlook for the second half, with Blackwell Ultra on track for mass production in Q3. Barclays' price target is based on a 29x multiple of its revised 2026 non-GAAP EPS estimate of $6.86.

Analysis

Barclays has significantly increased its price target for Nvidia (NVDA) to $200 from $170, representing a notable 38% potential upside from Nvidia’s June 16 closing price of $144.69, driven by positive supply chain indicators. These checks suggest an approximate $2 billion revenue upside for Nvidia in July compared to consensus estimates, prompting Barclays to elevate its full-year Compute revenue forecast for the company to $37 billion from $35.6 billion. While current Blackwell capacity reached about 30,000 wafers per month in June, falling short of Barclays’ previous expectation of 40,000 wafers, the firm highlights that utilizations are healthy and the supply chain sounds positive on the second half of the year. The mass production of Blackwell Ultra remains on track for the third quarter, which, along with increasing system sales (estimated to contribute 25% of revenue in July and approaching 50% by October), is expected to bolster gross margins in the latter half of the year. Consequently, Barclays has revised its Compute revenue projections for Nvidia's third and fourth calendar quarters upwards to $42 billion and $48 billion, respectively, exceeding both its previous projections and the Street consensus. This upgraded price target is underpinned by a 29x multiple applied to Barclays' revised 2026 non-GAAP earnings per share (EPS) estimate of $6.86, up from $6.43. Barclays maintains an Overweight rating on Nvidia, viewing it as having the most potential upside in its coverage for the second half of the year, despite a Neutral stance on the broader U.S. Semiconductors & Semiconductor Capital Equipment sector. The report also noted increased demand for Amazon’s Trainium 2, with supply meeting around 70% of the over 2 million units of demand and potentially adding $300 million in upside to this year’s ASIC revenue, alongside stable TPU supply checks with Google's V7 entering the supply chain and Q3 volumes expected to rise 20% quarter-over-quarter.

Key Decisions for Investors

• Investors may consider reviewing their Nvidia positions given Barclays' highlighted 38% potential upside and substantial revenue forecast upgrades, particularly focusing on second-half growth drivers such as Blackwell and system sales.
• Closely monitor Nvidia's progress on Blackwell Ultra mass production in Q3 and the ramp-up of system sales, as these are key catalysts for achieving the projected gross margin expansion and revenue targets identified by Barclays.
• While Barclays is bullish on Nvidia, its Neutral stance on the wider semiconductor sector warrants careful sector allocation; investors should also observe custom ASIC demand trends, such as for Amazon's Trainium 2, as an indicator of broader AI infrastructure investment and potential competitive dynamics.