On Wednesday, Goldman Sachs (NYSE:GS) reaffirmed its Conviction Buy rating on NVIDIA (NASDAQ:NVDA), with a steady price target of $135.00. The endorsement follows remarks from NVIDIA's leadership, outlining the company's strategic position and growth prospects in the accelerated computing space, particularly within data centers.
NVIDIA's CEO, Mr. Huang, emphasized the shift from Moore's Law as a driver of innovation, pointing to computation inflation in data centers. He predicted significant growth over the next decade, as densification and acceleration of the existing $1 trillion data center infrastructure would yield substantial performance improvements and cost savings.
The conversation also touched upon customer return on investment (ROI). With the end of transistor scaling, GPUs augmenting CPUs could potentially offer a net cost benefit, exemplified by a ~10x gain for applications like Spark, which could experience a speed increase of ~20x. Moreover, Mr. Huang indicated that hyperscale customers are generating considerable rental revenue, with $5 earned for every $1 spent on NVIDIA's infrastructure.
Mr. Huang delineated NVIDIA's competitive advantages, including a broad GPU installed base, the integration of hardware with domain-specific software libraries, and the capacity to create rack-level systems with innovations across various chips. NVIDIA's design of 7 chips for the Blackwell platform was highlighted as evidence of this competitive moat.
Addressing supply chain resilience, Mr. Huang credited partners like TSMC for enabling NVIDIA's significant revenue growth in the second half of 2023 and into 2024. He assured that NVIDIA possesses sufficient in-house Intellectual Property to adapt manufacturing processes with minimal disruption if necessary.
Finally, NVIDIA's CEO reaffirmed the shipping schedule for Blackwell-based products, starting in the fourth fiscal quarter of 2025, with scaling expected in fiscal year 2026. He expressed confidence in the strong demand for these products and acknowledged NVIDIA's pivotal role as a key provider for companies developing AI, including all CSPs.
InvestingPro Insights
As NVIDIA (NASDAQ:NVDA) continues to define its strategic trajectory in the accelerated computing space, the latest metrics from InvestingPro provide a quantitative backdrop to the company's robust outlook. NVIDIA boasts a perfect Piotroski Score of 9, reflecting strong financial health, and analysts have revised their earnings upwards for the upcoming period, signaling confidence in the company's performance.
InvestingPro data underlines this sentiment, with NVIDIA showing a remarkable revenue growth of 194.69% over the last twelve months as of Q2 2025, and a gross profit margin of 75.98%, underscoring the company's impressive profitability. Moreover, the company's stock has experienced a significant price uptick of 26.04% over the last six months, pointing to a positive market reception.
For investors seeking deeper insights, InvestingPro offers additional tips, including analysis on NVIDIA's trading at a low P/E ratio relative to near-term earnings growth, and its status as a prominent player in the Semiconductors & Semiconductor Equipment industry. With 21 more InvestingPro Tips available, including details on NVIDIA's dividend payments and liquidity, subscribers can gain a comprehensive understanding of the investment potential that NVIDIA holds.
Visit InvestingPro for a more detailed analysis: https://www.investing.com/pro/NVDA
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.