The Highly Anticipated Nvidia Earnings Report: Will Q3 Guidance Fall Short of Expectations?

Nvidia is set to release its latest earnings report next Wednesday, with the Q3 guidance becoming a focal point for the market.

 

A recent report from KeyBanc Capital Markets suggests that Nvidia may temporarily exclude direct revenue from the Chinese market in its next fiscal quarter guidance, as the approval timeline for semiconductor export licenses under U.S. restrictions remains uncertain.

 

KeyBanc analysts note that if Chinese business based on chips like H20 and RTX6000D (B40) were included, it could have added $2 billion to $3 billion in incremental revenue for Nvidia.

 

Currently, the market widely expects Nvidia’s Q3 revenue to reach $45.92 billion, with earnings per share at $1.01.

Capacity Boost Supports Fundamentals

Despite short-term uncertainty in the Chinese market, Nvidia’s business fundamentals remain robust, providing strong support for its long-term growth.

 

KeyBanc’s report highlights that improvements in Nvidia’s GPU supply and capacity are the core drivers of its sustained performance.

 

Data shows that GPU supply grew by 40% in the fiscal quarter ending July, with an expected additional 20% increase in the quarter ending October as B200 ramps up. Meanwhile, the updated, higher-performance B300 chip is slated to begin shipping in the October quarter, potentially accounting for half of the Blackwell series’ output.

 

Additionally, server rack production efficiency is improving.

 

The report notes that server ODM vendors’ GB200 rack manufacturing yield has reached nearly 85%, with shipment volumes expected to hit 15,000 to 17,000 racks by year-end. Consequently, the firm has raised its full-year GB200 rack shipment forecast from 25,000 to 30,000 units.

Wall Street Maintains Optimistic Outlook

While issuing a caution, KeyBanc analyst John Vinh raised Nvidia’s price target from $190 to $215 and maintained an “overweight” rating.

 

Susquehanna analyst Christopher Rolland also sees ongoing momentum in Nvidia’s data center business, lifting his price target from $180 to $210 and keeping a “positive” rating.

 

Despite price target upgrades from two Wall Street firms, market reaction remains cautious. Nvidia’s stock fell about 2.5% on Wednesday morning.

GoAI’advices

（Image source: GoAI）

GoAI'advice is that NVIDlA is a high-quality, growth-driven companywith strong fundamentals and a dominantposition in Al and data center markets.

 

Whiletechnical sentiment is currently bearish, long.term investors may view pullbacks asopportunities, provided they are comfortable withvolatility and valuation risks.