Nvidia's Sky-High AI Ambitions Under Fire: Goldman Sachs Flags 'Circular Revenue' Risk As Wall Street Questions 'Jensen's Math'

Core Viewpoint - Goldman Sachs has raised its price target for Nvidia to $210 from $200 while issuing a warning about potential "circular revenue" that could dilute Nvidia's valuation due to its dual role as both supplier and investor [1][2]. Group 1: Price Target and Ratings - Goldman Sachs maintains a Buy rating on Nvidia while increasing its price target to $210 [2]. - Barclays has also raised its price target for Nvidia to $240, labeling it the "most attractive name in our space" [6]. Group 2: Revenue Concerns - Goldman Sachs expressed concerns that Nvidia's strategic investments in its customers could lead to "circular revenue," necessitating additional scrutiny [2]. - Barclays challenges CEO Jensen Huang's aggressive revenue projections, known as "Jensen's Math," suggesting a more conservative revenue potential for Nvidia's AI factories [4][5]. Group 3: Market Projections - Barclays' "AI capacity tracker" estimates compute-related spending per gigawatt (GW) at $32.5 billion to $42 billion, contrasting with Huang's estimates of $40 billion to $50 billion [5]. - Despite the critiques, analysts remain generally optimistic about Nvidia's role in the AI revolution, albeit with careful examination of its financial structure and market sizing [6]. Group 4: Stock Performance - Nvidia shares fell 0.70% to $187.62 on Friday but rose by 1.16% in premarket trading on Tuesday, with a year-to-date increase of 35.65% and a 46.90% rise over the past year [7].