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Nvidia (NASDAQ:NVDA) shares rose in premarket trading on Wednesday, continuing their run since the start of the month, as investment firm Citi maintained its buy rating heading into third-quarter earnings.
Analyst Atif Malik, who also has a $575 price target on Nvidia (NVDA), said buy-side estimates for data center revenue for the next two quarters are well above Wall Street consensus. Investors are expecting between $13.5B and $14B for the fiscal third-quarter and between $15B and $15.5B for the fiscal fourth-quarter, compared to estimates of $12.9B and $14.7B, respectively.
“Going into earnings, we believe investors are focused on: the US restrictions of AI chips to China and its impact on NVDA’s data center sales outlook in [fiscal 2025 and 2026]; overall data center sales’ sustainability and early data points from Gen AI applications/products; and NVDA’s new AI hardware roadmap,” Malik wrote in an investor note.
Earlier this week, Nvidia (NVDA) announced its new H200 GPU, along with the JUPITER supercomputer.
Malik said the company’s artificial intelligence GPU roadmap is “blistering,” referencing its recently released cadence for new GPUs, moving from roughly two years to one years for the successor of the B100 chip, the X100.
“If successful, we view this move by NVDA as the maneuver that will define the AI chip race for years to come,” Malik said.
Regarding the competition, Malik said Intel’s (INTC) Gaudi and Google’s (GOOG) (GOOGL) TPUs are “making progress,” but Nvidia’s (NVDA) H100 is still “comfortably ahead,” especially at larger volumes.
He also said that the newly announced H200 AI GPU, which sports a drastic increase in memory, is in-line with expectations, given AMD’s (AMD) strategy “to offer more in-chip memory in its upcoming MI300 GPU than the H100,” Malik explained.
Image and article originally from seekingalpha.com. Read the original article here.