Nvidia stock hits new record on Monday ahead of CEO Jensen Huang’s keynote address at the annual Consumer Electronics Show (CES) in Las Vegas.
Shares rose more than 3% to $149.43 — north of Nvidia's previous record closing price of $148.88 per share on Nov. 7, 2024.
As Wall Street analysts make their way to Las Vegas to engage with executives from leading tech companies, Nvidia, the prominent AI chipmaker, is drawing significant attention. Known for making key product announcements at the CES trade show, Nvidia recently showcased new desktop graphics chips aimed at gaming and AI. This year, CEO Jensen Huang's insights are anticipated to provide investors with a preview of the company's future direction and the rapidly expanding AI market.
Huang is set to deliver his keynote address at 6:20 p.m. PST on Monday, with the event being livestreamed across platforms like Facebook, YouTube, and LinkedIn.
His speech comes at a time when investors are keenly anticipating the launch of Nvidia’s latest Blackwell AI chips. Analysts believe these chips will ignite a significant new wave of demand for the company’s products, even amidst concerns about a potential slowdown in AI spending.
Following a design flaw that delayed the rollout of the Blackwell lineup and circulating rumors about overheating issues in servers using these chips, Nvidia confirmed during a November earnings call that production of the Blackwell series is increasing this quarter, with shipments to customers arriving sooner than expected. Stifel analyst Ruben Roy has indicated that the Blackwell AI chips could represent a $100 billion market opportunity for Nvidia.
source: CNN
Nvidia stock surges today, the catalyst is Foxconn's latest quarterly report, released on Sunday. The Taiwan-based semiconductor manufacturer exceeded expectations, reporting record fourth-quarter revenue of T$2.13 trillion ($64.72 billion).
This growth stems from increasing AI server demand from clients like Nvidia, while revenue from consumer devices, such as Apple’s iPhones, has remained flat. The market interprets this as a positive indicator that Foxconn's customers, including Nvidia, are experiencing sustained demand for AI and data center products.
Foxconn and Nvidia are closely linked through their partnership in manufacturing advanced chips utilized in data centers, AI training models, and other high-performance applications. This includes the essential A100 and H100 GPUs, which are critical for training large-scale AI models.
In October, Foxconn announced plans to establish the world’s largest production facility in Mexico for bundling Nvidia’s GB200 Superchips, built on its Blackwell architecture, aimed at large language models (LLMs) and other advanced AI applications.
In December, Morgan Stanley raised its price target for Nvidia (NVDA) to $166 per share, reflecting growing confidence in the company's future potential. Analysts at Morgan Stanley highlighted that while Nvidia is currently experiencing "transitional pressures" due to a slowdown in demand for its Hopper chips, the landscape is expected to shift significantly in the near future.
The primary concern for Nvidia stems from the diminishing demand for its Hopper architecture, which has been a cornerstone of its recent product offerings. This slowdown has raised questions about the company's short-term performance and profitability. However, analysts believe that by the second half of 2025, the narrative around Nvidia will pivot towards the anticipated strength of its upcoming Blackwell chips. These chips are expected to drive substantial growth, particularly in the AI sector, as demand for data center products and AI training models continues to rise.
The Blackwell architecture is designed for advanced applications, including large language models and other AI functionalities, positioning Nvidia to capitalize on the growing interest in AI technologies.
Moreover, analysts are optimistic about Nvidia's strategic partnerships and initiatives, such as its collaboration with Foxconn to produce advanced AI chips. These efforts not only enhance Nvidia's product lineup but also strengthen its market position in a competitive landscape.
Overall, while current challenges exist, the outlook from analysts suggests that Nvidia's future is bright, especially with its Blackwell chips on the horizon. As the demand for AI technologies surges, Nvidia is well-positioned to leverage these opportunities, potentially making it a compelling investment as it navigates through transitional phases in its product offerings.
Nvidia CEO Jensen Huang is set to deliver a keynote speech tonight at CES 2025, scheduled for 9:30 PM Eastern. He is expected to update investors on the company’s AI strategy, upcoming product launches, and advancements in chip technology. There may also be announcements regarding the RTX 5000 series and Blackwell chips.
Nvidia’s next earnings report is anticipated on February 26, 2025, after market close.
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