Nvidia's Earnings Anticipation Boosts Goldman Sachs Target Price 8%

Nvidia, a prominent semiconductor company, is on the verge of a significant financial milestone as it prepares to unveil its second-quarter earnings. In anticipation of this, Goldman Sachs has elevated its target price for Nvidia from 185 dollars to 200 dollars, while retaining a "buy" rating. The analyst, Schneider, believes that despite the high market expectations, Nvidia is set to deliver financial results that surpass expectations and raise its guidance.

Schneider underscores the importance of focusing on the company's earnings guidance, particularly the progress of its China business and changes in profit margins, which could serve as key catalysts for stock price movements. The upcoming earnings call is expected to address three critical areas. The first is the production timeline for the Blackwell chip in the second half of the year and the development progress of the next-generation Rubin chip architecture, scheduled for release in 2026.

The second focus area is the timeline for the H20 chip, designed for the China market and compliant with U.S. export regulations. The launch schedule and expected revenue contribution of these lower-spec AI chips will be crucial in assessing Nvidia's resilience in the China market. The third area of interest is the trend in gross margins, particularly whether the company can release profit margins by absorbing H20 chip inventory. It is noteworthy that Nvidia's stock price has risen approximately 34% by 2025, necessitating strong financial performance to sustain the current valuation.

Market expectations for this earnings report are high. Analysts generally anticipate that Nvidia will achieve 457 million dollars in revenue and 1 dollar in earnings per share. The company's ability to meet or exceed these expectations will be closely watched by investors and analysts alike. The upcoming earnings call is expected to address three critical areas. The first is the production timeline for the Blackwell chip in the second half of the year and the development progress of the next-generation Rubin chip architecture, scheduled for release in 2026.

The second focus area is the timeline for the H20 chip, designed for the China market and compliant with U.S. export regulations. The launch schedule and expected revenue contribution of these lower-spec AI chips will be crucial in assessing Nvidia's resilience in the China market. The third area of interest is the trend in gross margins, particularly whether the company can release profit margins by absorbing H20 chip inventory. It is noteworthy that Nvidia's stock price has risen approximately 34% by 2025, necessitating strong financial performance to sustain the current valuation.