NVIDIA Corp (NASDAQ:NVDA, ETR:NVD) is anticipated to report strong first-quarter earnings on Wednesday, with Barclays indicating potential upward revisions based on recent research.
“All signs point to another revision higher,” said analysts, noting that Asia checks suggest a nearly 10% upside in graphics processing unit sales in the quarter (increasing to over 20% for the quarter ahead as capacity expands).
“We believe the company can capture incremental revenue upside due to pricing on H200, which will start shipping in the July quarter,” said the bank.
H200 is one of Nvidia’s cornerstone products, a GPU highly optimised for generative artificial intelligence applications.
Barclays projects NVIDIA's data center segment revenue (which encompasses AI chip sales) to be around $23 billion in the first quarter, extending $24.5 billion in July, surpassing Street estimates of $21.1 billion and $22.8 billion, respectively.
These projections include contributions from Mellanox Technologies (MLNX), which Nvidia bought for $6.9 billion in 2019.
“While investor concerns through the quarter have largely centered on a potential air
pocket in the middle of the year ahead of the Blackwell launch, we still do not see evidence of this occurring, with the tone from our checks remaining mostly unchanged,” said Barclays.
Blackwell is Nvidia’s next generation of high-end GPUs.
Barclays is overweight on Nvidia stock with a $1,100 price target against the current $946 share price.