Wall Street analysts struck a bullish tone on Nvidia Corp (NASDAQ:NVDA, ETR:NVD) after the chipmaker’s latest quarterly results, cheering strong fundamentals, accelerating AI rack-scale deployments, and improving gross margins despite near-term headwinds from US export restrictions to China.
Bank of America noted the ramp-up of the new Blackwell architecture, de-risked China sales, and improving gross margins. The bank expects Nvidia’s gross margins to return to the mid-70% range by year-end and sees the company’s long-term earnings power reaching $10 per share, underpinned by 80–85% market share in AI and a total addressable market of up to $500 billion.
“Blackwell is now in full production with hyperscalers ramping close to 1,000 racks per week,” BofA analysts wrote. “We see $10 or more in earnings per share potential and free cash flow margins above 50%, making Nvidia’s price-to-earnings-to-growth ratio of 0.9 especially compelling.”
UBS echoed that optimism. The firm said Nvidia’s results and guidance met high investor expectations, while gross margin commentary and Blackwell-related disclosures were stronger than feared.
“The most bullish takeaway was Nvidia confirming that hyperscalers are each deploying nearly 1,000 Blackwell racks per week,” UBS analysts wrote, adding that this supports a positive view on supply chain dynamics and validates ramp expectations into the second half of the year.
Although Nvidia’s FQ1 data center revenue was hit by a $2.5 billion shortfall due to the US ban on China’s H20 chips, both banks view the underlying demand as robust. UBS anticipates a partial rebound starting in FQ3, with a potential $2 to $3 billion quarterly sales recovery if new China-approved SKUs are greenlit.
Risks remain, including supply chain execution tied to Nvidia’s accelerated annual product launch cadence and geopolitical tensions over AI chips. Still, analysts view the broader demand trajectory—fueled by sovereign AI projects and expanding hyperscaler capex—as more than offsetting those challenges.
“Nvidia’s AI platform is scaling globally and rapidly,” UBS said. “With momentum in Blackwell and a likely mid-70s gross margin exit rate for FY26, investor concerns on inventory buildup appear overdone.”