Nvidia shares have risen 25% in the past month and are nearing a record high ahead of tech earnings season in the coming weeks, when major players like Meta, Microsoft and Alphabet will update shareholders on their expected investments in artificial intelligence.
After a brief but dramatic pullback in late August and early September, Nvidia has rebounded sharply. The stock closed slightly lower on Wednesday at $132.65, just below its June closing high of $135.58.
Nvidia has overtaken Microsoft as the second most valuable company, behind only Apple, according to CNBC.
The biggest beneficiary
Nvidia has been the biggest beneficiary of the AI boom, as companies including Meta, OpenAI, Alphabet, Microsoft, and Oracle continue to unveil technologies and products that require huge investments in their GPUs.
In August, Nvidia reported fiscal second-quarter earnings that showed revenue up 122% year-over-year while net income more than doubled to $16.6 billion.
The company also gave a stronger-than-expected estimate for the current quarter and said it expects to ship several billion dollars worth of its new Blackwell AI chip. Demand is so high that Nvidia expects to see shipments of its current-generation Hopper chip increase over the next two quarters.
“We see Nvidia remaining the leader in AI training and inference chips for data center applications,” Mizuho analysts said in a note on Wednesday, estimating the company has about 95% of the market.
Target price and risks
Analysts have a price target of $140 per share, but they point to risks from escalating export restrictions to China, geopolitical tensions over Taiwan or a significant decline in spending on AI servers.
“Everyone wants to have the most and everyone wants to be first,” CEO Jensen Huang said in an interview with CNBC last week, speaking about the crazy demand for Blackwell’s chip.
GPU production, which will cost between $30,000 and $40,000 per unit, is expected to ramp up in the fourth quarter and continue through fiscal 2026.
The stock has been rising for other reasons over the past month, too. Nvidia shares jumped 4% on Sept. 23 after a filing showed Huang had finished selling the company’s shares.
