Nvidia's AI Expansion Could Push Revenue To $300 Billion By 2026, Analyst Says

Core Viewpoint - Nvidia is expected to exceed Wall Street's expectations due to increasing demand for AI and its new Blackwell architecture, with a strong revenue forecast of $48 billion for the second quarter and continued growth anticipated through 2026 [1][4]. Revenue Forecasts - The company is projected to generate $48 billion in revenue for the fiscal second quarter, surpassing consensus estimates of $45.8 billion [4]. - For the October quarter, revenue is estimated at $55 billion, again above consensus expectations of $52.6 billion, with the Data Center segment contributing approximately $49.9 billion [5]. Data Center Segment - The Data Center segment is identified as the primary growth driver, with forecasts of $42.9 billion in sales from this segment alone for the second quarter [5]. - Long-term projections estimate Data Center revenue at $200 billion in calendar 2025 and $300 billion in calendar 2026, significantly higher than current market forecasts of $181 billion and $235 billion, respectively [5]. Earnings Projections - Earnings per share (EPS) is projected at $1.06 for the second quarter, compared to consensus of $1.00, and $1.25 for the October quarter, exceeding consensus of $1.18 [4][5]. - For calendar 2025 and 2026, earnings power is expected to reach $4.85 and $8.00 per share, respectively, compared to consensus estimates of $4.37 and $5.89 [6]. Market Dynamics - The analyst highlights a significant increase in hyperscaler capital expenditures, projected to grow by 57% in calendar 2025 and another 20% in calendar 2026, alongside a $1.5 trillion global sovereign AI investment pipeline [6]. - Increasing enterprise adoption of AI technologies is also noted as a key driver for Nvidia's growth [6]. Competitive Positioning - Nvidia's roadmap beyond Blackwell, including the upcoming Rubin platform, is expected to enhance visibility into 2026 and solidify the company's leadership in AI infrastructure [7][8]. - Despite challenges in China due to export restrictions, any unexpected shipments could provide upside to current revenue estimates, with gross margins projected to reach the mid-70% range by late calendar 2025 [7].