nvidia's growth: analyst sees potential slowdown despite strong forecast

2025-09-12 nvidia

new york, Friday, 12 September 2025.
despite nvidia’s projected ‘staggering’ earnings and continued dominance in ai computing, one analyst is questioning the magnitude of its future growth. this concern highlights the importance of monitoring nvidia’s expansion rate, especially given its high valuation and increasingly competitive market. the analyst’s perspective could influence investor sentiment and nvda’s stock performance as markets digest whether nvidia can maintain its exponential trajectory or if a deceleration is on the horizon. will the ai leader’s rise continue unabated, or are headwinds gathering?

analyst upgrade

Despite some reservations, D.A. Davidson upgraded Nvidia to a ‘buy’ rating, citing the continued growth in ai computing demand as a key driver for the ai chip manufacturer [2]. The firm also increased its price target from $195 to $210 [2]. Analyst Gil Luria stated that their increasing optimism about ai computing demand outweighed their list of concerns regarding nvidia [2]. Luria anticipates nvidia remaining central to ai, with strong demand supporting growth into the next year and potentially beyond [2].

growth factors

Luria acknowledged potential challenges such as capital expenditure constraints from hyperscale cloud service providers, clients developing their own chips (like Google’s TPU), fluctuations in chinese demand, and supply limitations across energy and semiconductor manufacturing [2]. Despite these challenges, Luria emphasized that the significant increase in computing demand remains the most critical factor [2]. He believes nvidia can sustain growth over the next two years, irrespective of the specific growth areas [2]. He also noted investors have been forgiving of slight earnings misses in past quarters [2].

valuation comparison

Luria considers nvidia potentially the most affordable direct investment in ai growth, trading at 28 times the projected 2026 earnings, with an approximate 40% profit growth rate [2]. The analyst drew a comparison with Apple, which D.A. Davidson downgraded to ‘neutral’, noting both companies trade at similar multiples, yet Apple’s expected earnings growth is only 9% [2]. Luria stated that while Apple may offer defensiveness in an uncertain environment, they prefer an offensive strategy given the prospects of ai computing [2].

optimistic outlook

Other analysts share an optimistic view, with one firm suggesting nvidia is the most likely candidate to achieve a $10 trillion market capitalization [5]. Nvidia’s revenue surged by 86% in 2024, reaching $113.3 billion, with operating profits doubling to $71 billion [5]. This growth is attributed to increased capital expenditure by hyperscale companies in data centers [5]. Nvidia’s dominance in the gpu market, holding a 90% share, further solidifies its position [5].

blackwell architecture

Nvidia’s next-generation Blackwell architecture is expected to significantly enhance gpu performance [5]. Predictions estimate that gb200 product shipments will exceed one million units by 2025, capturing 40% to 50% of the high-end market [5]. Huang announced at ces 2025 that blackwell is in full production, with around 45 factories manufacturing blackwell systems [5]. The Blackwell gpu is projected to offer a 2.5x performance increase over the Hopper gpu in ai training workloads, with some benchmarks showing a 15x improvement in inference performance [5].

uk investment

Nvidia and openai are reportedly discussing a major investment to bolster ai infrastructure in the uk, potentially worth billions of dollars [7]. These firms are in talks to support data center development in the country, collaborating with cloud computing firm nscale [7]. An investment agreement is anticipated to be revealed during president trump’s state visit to the uk [7]. Nvidia ceo jensen huang previously called the uk an ‘incredible place to invest’ and stated the company would increase its investment in the country [7].

Bronnen

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