Nvidia's Long-Term Prospects: Analyst Bullish on Blackwell Chip Demand

2025-04-30 nvidia

New York, Wednesday, 30 April 2025.
Neuberger Berman’s Dan Flax forecasts a bright future for Nvidia, provided the company maintains its strong execution. The key driver? Surging demand for Nvidia’s Blackwell chips. This positive outlook comes even as Nvidia stock has dropped 17.4% this year. However, challenges remain. Huawei is ramping up AI chip production, potentially challenging Nvidia’s dominance. Furthermore, US export restrictions on advanced chips to China could impact revenue, with a projected $5.5 billion charge in fiscal year 2026. Despite these headwinds, analysts maintain a “strong buy” rating, with an average price target of $167.80.

Blackwell’s Impact on Data Centers and Revenue

Nvidia’s Blackwell architecture is designed for reasoning AI [4]. Oracle has already deployed thousands of Blackwell GPUs in its data centers for customer use [5]. These deployments leverage the GB200 NVL72 platform, which combines 36 Grace CPUs and 72 Blackwell GPUs [5]. Nvidia’s focus on Blackwell is expected to drive significant revenue growth. The company projects revenue of $43 billion for the first quarter of fiscal year 2026, compared to $26 billion in the same period of fiscal year 2025 [4]. This represents a 65.385 increase.

Competitive Landscape and Market Dynamics

Despite positive projections, Nvidia faces increasing competition. Huawei is increasing its AI chip production, potentially challenging Nvidia’s technology lead [2][3]. U.S. export restrictions on H20 chips to China will result in a $5.5 billion charge for Nvidia [3][4]. These restrictions limit Nvidia’s access to the Chinese market, which generated over $17 billion in revenue in fiscal year 2025 [4]. However, China has reportedly rolled back some retaliatory tariffs on U.S. semiconductors, potentially easing trade tensions [3].

Nvidia’s Broader Market Strategy

Nvidia is expanding its reach beyond data centers. The company anticipates its automotive revenue will grow to around $5 billion in fiscal year 2026 [4]. Nvidia is also focusing on cybersecurity, bringing runtime security to AI factories with its DOCA software framework [7]. Furthermore, Nvidia is innovating in data center cooling, with Blackwell systems increasing water efficiency by over 300 times [8]. Liquid cooling technologies can save hyperscale data centers $4 million annually for a 50 MW facility [8].

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