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On Wednesday, HSBC analyst Frank Lee adjusted the price target on NVIDIA stock (NASDAQ:NVDA), reducing it from $185.00 to $175.00, while continuing to endorse the stock with a Buy rating. The semiconductor giant, currently valued at $3.43 trillion, maintains strong financial health with a perfect Piotroski Score of 9, according to InvestingPro data. Lee’s analysis suggests that while there are persistent supply chain challenges, particularly with ODM assembly impacting the GB200, NVIDIA is expected to counterbalance this with increased shipments of the B200 GPU in the first half of FY26.
Lee anticipates that NVIDIA will be able to meet significant revenue targets despite the supply chain hurdles. The company, which has demonstrated impressive revenue growth of 152.44% over the last twelve months with industry-leading gross margins of 75.86%, is projected to achieve revenues of approximately $5 billion and $10 billion in the fourth quarter of FY25 and the first quarter of FY26, respectively. These figures are expected to contribute to total revenues of $40 billion for 4QFY25 and $42.2 billion for 1QFY26, surpassing the consensus estimates of $38.2 billion and $42 billion.
In light of the upcoming 4QFY25 results scheduled for release on February 26, Lee predicts that NVIDIA’s sales will exceed both the management’s guidance and the market consensus, which stand at $37.5 billion and $38.2 billion, respectively. InvestingPro analysis reveals over 15 additional key insights about NVIDIA’s financial health and valuation metrics, with comprehensive coverage available in the Pro Research Report. For the first and second quarters of FY26, sales forecasts of $42.2 billion and $55.4 billion, respectively, are also higher than the consensus estimates, suggesting a strong outlook for the first half of FY26 despite the ongoing supply side issues.
The analyst also noted that market attention might shift towards the momentum of Blackwell revenue, rather than overall sales momentum. With the expected ramp-up of the B200, these revenues could surpass market expectations. Lee’s commentary reflects a cautious yet optimistic view of NVIDIA’s ability to navigate supply chain difficulties while still achieving significant revenue milestones.
In other recent news, DeepSeek, a Chinese artificial intelligence startup, is considering raising outside funding due to increased demand for its AI chatbot app, which has gained significant popularity. The company, which previously avoided external funding, is now in discussions with potential investors like Alibaba (NYSE:BABA) Group and Chinese state-affiliated funds. In addition, DeepSeek is contemplating using data centers in Southeast Asia to access more Nvidia AI chips to meet its growing infrastructure needs. Meanwhile, Figure AI Inc. is in advanced talks to secure $1.5 billion in funding, which would value the company at $39.5 billion. This funding round is expected to be led by Align (NASDAQ:ALGN) Ventures and Parkway Venture Capital, highlighting the rising interest in humanoid robots.
In another development, Dell Technologies Inc. (NYSE:DELL) is nearing a deal to supply AI-optimized servers to Elon Musk’s startup, xAI. The agreement, valued at over $5 billion, involves servers equipped with Nvidia Corp . GB200 semiconductors, scheduled for delivery this year. On the analyst front, Jefferies has maintained a Buy rating for NVIDIA, with a price target of $185. This comes after Foxconn (SS:601138)’s revenue report suggested improved first-quarter revenue growth for 2025, positively impacting NVIDIA’s outlook. Jefferies’ analyst expressed confidence in NVIDIA’s Blackwell project despite supply chain concerns, suggesting resilience and growth potential for the company.
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