Nvidia Quells 'AI Bubble' Fears With 'Drop The Mic Quarter/Guidance'

Core Viewpoint - Analysts have raised estimates and price targets for NVIDIA Corporation following strong third-quarter revenue and earnings per share that exceeded expectations, along with optimistic guidance for future sales growth [1][3]. Financial Performance - NVIDIA reported a quarterly revenue of $57 billion, significantly surpassing analyst expectations, which has led to a reassessment of the company's growth potential [3][5]. - The company is projected to achieve $500 billion in sales from its Blackwell and Rubin products by the end of 2026, indicating strong future demand [5][10]. Analyst Ratings and Price Targets - Bank of America analyst Vivek Arya set a price target of $275, while DA Davidson's Gil Luria also set a target of $250, both maintaining a Buy rating [7]. - KeyBanc's John Vinh raised the price target from $250 to $275, highlighting strong demand in the AI sector [4][7]. - Other analysts, including Wedbush and JPMorgan, have also raised their price targets, reflecting confidence in NVIDIA's growth trajectory [7][9]. Market Position and Demand - Analysts noted that NVIDIA's Blackwell Ultra product now accounts for approximately 66% of Blackwell revenue, with expectations for this percentage to increase [4][10]. - The company is seen as a foundational supplier for next-generation digital infrastructure, positioning it well within the AI revolution [5][10]. Supply Chain and Backlog - Improvements in NVIDIA's supply chain were highlighted, contributing to a strong backlog of $500 billion in demand, which may not fully account for new contracts [6][13]. - Analysts believe that the ongoing demand for AI compute resources indicates no slowdown in the market, reinforcing NVIDIA's strong position [10][11]. Industry Outlook - The AI sector is projected to see annual spending of $3 trillion to $4 trillion on infrastructure by 2030, with NVIDIA expected to capture a significant share of this incremental spending [10][12]. - Analysts assert that concerns regarding an AI bubble are mitigated by NVIDIA's strong performance and strategic positioning in the market [11][12].