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Investing.com -- Following a late and slow start, Nvidia’s advanced AI accelerator GB200 is now starting to gain momentum, according to Baird analysts, citing their latest supply chain checks.
The GB200 is now expected to represent the majority of Nvidia’s (NASDAQ:NVDA) GB mix in the second half of 2025 (2H25) and into 2026. The initial delays were attributed to data center availability, such as space and electricity, rather than a lack of demand, and the time needed to implement and optimize new architecture features.
Baird analysts said Nvidia is pushing NVL72 implementations to improve efficiency, and investors are advised not to expect customers to bypass the GB200 for next-generation products.
“We expect GB200 to represent the majority of Nvidia’s GB mix in 2H25 and into 2026. GB300 crossover is expected not until 2H26,” Baird analyst Tristan Gerra said in a note.
Furthermore, strong GB200 orders from a key enterprise customer, coupled with high demand from hyperscalers, are contributing to Nvidia’s positive outlook.
Baird also highlighted Nvidia’s robust product roadmap ahead, with new products like B300 and Rubin expected to deliver performance improvements of over 1.5 times compared to previous generations.
Spectrum-X, the tech giant’s networking platform designed to optimize AI data centers, has begun shipping, with Meta (NASDAQ:META) set to complete initial sampling in the coming month. Analysts said Nvidia’s Infiniband technology maintains a lead over Ethernet with new product introductions.
The analysts also noted an uptick in orders from companies such as Ali and Tencent (HK:0700) as DeepSeek, a model that enables enterprises to train their own knowledge base with smaller GPU resources, is deployed.
“We are seeing a very recent surge in orders from Ali and Tencent as DeepSeek is being rolled out,” analysts said.
The use of Chiplet and Package-on-Package (CPO) technologies is also gaining traction, Baird observed, with initial volumes forecasted to begin in the second half of 2026.
The investment bank reiterated its Outperform rating and the price target of $195 on Nvidia stock, which reflects a 30x multiple on the firm’s fiscal year 2027 (calendar year 2026) pro forma earnings per share estimate, excluding stock expenses, of $6.50.
“This multiple is above the high end of peers’ range P/E (11x-25x), due to Nvidia’s strong positioning in AI datacenter markets/share gains,” analysts noted.
Baird flagged several potential risks to its outlook, including higher competition, industry cyclicality, inventory fluctuations, and end-market concentration.