Analysts anticipate Nvidia to report a record $43 billion revenue in its Q1 earnings, with key questions around China sales and export restrictions expected.
Nvidia, the global chipmaking giant, is set to release its fiscal first-quarter earnings after market close on Wednesday. Analysts expect the company to post record revenues and foresee inquiries regarding sales in China and the impact of U.S. export controls.
Nvidia’s Revenue and Profit Expectations
Nvidia, the world’s second most valuable company by market capitalization, is scheduled to announce its fiscal first-quarter earnings after the market closes on Wednesday, June 18. This report has drawn significant attention from analysts and investors who anticipate the company will once again solidify its upward growth trajectory by setting a new revenue record.
On average, analysts project Nvidia’s revenue to reach approximately $43.38 billion for this period, reflecting a 66% increase year-over-year. Adjusted net income is expected to rise to $21.29 billion, or 87 cents per share, a significant jump compared to $15.24 billion, or 61 cents per share, reported in the same quarter last year.
Extensive AI Investments and Their Impact on Nvidia
Wedbush analysts believe Nvidia will continue to benefit from large-scale investments in AI infrastructure made by major technology companies such as Meta, Alphabet (Google’s parent), Apple, Amazon, and Microsoft. According to these analysts, a disproportionate share of AI-related spending flows to Nvidia, which supplies key components for AI servers.
Challenges and Export Restrictions Impacting Sales in China
Analysts also expect questions regarding Nvidia’s sales performance in China, especially following the tighter export restrictions imposed earlier this year by the U.S. government. These restrictions have particularly affected Nvidia’s H20 chip, with the company warning of a potential $5.5 billion charge related to these limitations. Nvidia’s CEO Jensen Huang has criticized the export curbs as a policy “failure” that is accelerating China’s development of its own AI chips.
Oppenheimer analysts view the impact of these restrictions as relatively modest. They note that China currently accounts for just 5% of Nvidia’s total sales, indicating room for growth despite losing H20 chip sales to the Chinese market.
Analysts’ Ratings and Price Targets for Nvidia Stock
Both Wedbush and Oppenheimer have assigned Nvidia shares an “Outperform” rating with price targets of $175 per share. Of the 18 analysts tracking Nvidia, 16 recommend buying the stock, while only two suggest holding it. The consensus price target hovers around $164, implying roughly 25% upside potential from last Friday’s closing price.
Although Nvidia’s stock has seen a slight decline this year, it remains up approximately 25% over the past 12 months, maintaining its status as a key player in the technology and AI sectors.
Conclusion
Nvidia’s upcoming Q1 earnings release will provide clearer insights into the company’s growth prospects in the technology and AI domains, further cementing its role as a leading innovator in the global chip and tech industry.
