The Stock of Nvidia is Rising as Analysts Predict a $2 Billion Quarter-over-quarter Beat

Piper Sandler analyst Harsh Kumar is optimistic about Nvidia Corp.’s ability to surpass Wall Street's high expectations with another impressive revenue performance.

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"In our bullish scenario, we see Nvidia potentially exceeding the reported July-quarter revenue by over $2 billion, supported by an uptick in networking supply," Kumar wrote in a note to clients on Monday.

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The FactSet consensus estimates revenue for the July quarter at $28.6 billion. However, Kumar's base-case estimate is slightly lower, at $28.0 billion.

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Nvidia has a history of exceeding revenue expectations, having outperformed by $1.45 billion in the April quarter and by $1.71 billion in the January quarter.

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Kumar remains positive about Nvidia’s prospects ahead of its July-quarter earnings and October-quarter guidance. He anticipates that the strong business trends Nvidia has demonstrated over the past year will continue, boosted by the official launch of the Blackwell architecture in the October quarter.

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Nvidia shares are up 1.9% in premarket trading on Monday. The stock had closed down about 13% from its mid-June high of $135.58 on Friday.

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Kumar believes the new Blackwell chip lineup has the potential to drive a new phase of growth for Nvidia, as cloud providers, enterprises, and governments continue to invest heavily in artificial intelligence hardware.

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Multiple traditional cloud-service providers are expected to upgrade to Blackwell to gain power and pricing advantages. Kumar is also enthusiastic about Nvidia's prospects with sovereign governments, noting that several countries, including Japan, the UAE, and France, are deploying their own unique clusters.

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Kumar also highlighted improvements in networking-chip supply as a positive factor for Nvidia's future performance.

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As a result, Kumar raised his price target for Nvidia from $120 to $140, which is 19% above current levels and higher than the $132.42 FactSet average.

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