NVIDIA once again rattled markets with better-than-expected earnings, presenting a forward-looking outlook that prompted Wall Street to reprice the stock.
During its latest earnings conference call, the company projected that revenue growth for the fiscal year ending January 2028 could exceed 70%, significantly surpassing the FactSet consensus estimate of approximately 45%. TD Cowen analyst Joshua Buchalter described this forward guidance as "a potentially significant catalyst for the stock price," directly driving an 8.7% surge in NVIDIA’s shares on Thursday—the largest single-day gain since May 2024. At the close of trading, NVIDIA’s market capitalization rose to $5.49 trillion, adding $441.5 billion in a single day, marking the second-largest single-day increase in market value in corporate history.
Even more strikingly, some analysts are looking further ahead. Raymond James analyst Simon Leopold wrote in a research note that achieving $1 trillion in revenue for the fiscal year ending January 2029 "seems plausible" for NVIDIA, whereas the FactSet consensus estimate as of Wednesday placed revenue for that year at under $750 billion.
70% Growth Guidance: A Conservative Forecast Amid Supply Constraints
NVIDIA’s management explicitly stated during the earnings call that the 70% growth forecast already accounts for supply tightness, and actual figures would be higher in the absence of supply bottlenecks. JPMorgan also noted that although the performance guidance far exceeded expectations, it may still be conservative. The company clearly characterized the current phase as "supply-constrained," indicating that demand momentum would be significantly stronger if supply were not limited.
Goldman Sachs analyst James Schneider believes that if NVIDIA continues to collaborate with technology companies to advance data center construction and further bridge the gap between customer demand and supply, the company is poised to outperform its guidance in fiscal year 2028.
Regarding gross margins, NVIDIA anticipates some compression for the remainder of the current fiscal year but simultaneously projects that gross margins will stabilize in the 72% to 73% range in the next fiscal year. Simon Leopold considers this level, while lower than recent highs, sufficient to alleviate market pessimism, noting that given rising memory chip prices and intensifying competition in custom chips, this guidance range is "better than the worst-case scenario."
Rubin Platform and Ecosystem Moat: Multiple Growth Engines Taking Shape
Buchalter interprets this guidance as a "strong signal of confidence" in NVIDIA’s business visibility, against the backdrop of the mass production and shipment of its new generation chip platform, Vera Rubin. Vera Rubin is NVIDIA’s next-generation artificial intelligence chip platform following Blackwell.
Bernstein analyst Stacy Rasgon stated that NVIDIA’s July quarter results "should remind investors why they hold this stock." In his research note, he pointed out that demand is accelerating, coinciding with the Rubin platform becoming the "largest upcoming product cycle" in NVIDIA’s history.
Rasgon also emphasized that NVIDIA's balance sheet is becoming a "moat as important as its technology." The company not only locks in customers for products worth hundreds of billions of dollars through equity investments and revenue-sharing agreements, but is also able to "support and strengthen the ecosystem around its products."
Simon Leopold believes that, in terms of revenue contribution, the Vera Rubin chip itself is expected to account for approximately 20% of data center revenue in the third fiscal quarter. During the same period, Groq’s LPU has reached full production capacity and will begin large-scale shipments later this quarter, with emerging cloud service provider NEBIUS among the first adopters. The ramp-up speeds for both Rubin and LPU capacities have exceeded previous model forecasts, leading to upward revisions in related estimates.
Simon Leopold further pointed out that NVIDIA's progress in the CPU business has also exceeded expectations. The trailing twelve-month revenue for Grace CPU has surpassed $5 billion, and the next-generation product, Vera CPU, has currently entered full production. Based on order conditions, NVIDIA's CPU business has reached an annualized revenue scale of $20 billion. As supply continues to improve, CPU revenue in fiscal year 2028 is expected to more than double.
Divergence between bulls and bears on Wall Street persists, but bulls are accumulating more positions.
Although NVIDIA's strong performance has significantly boosted bull confidence, market divergence has not completely dissipated. Buchalter admitted that NVIDIA's strategy of providing financing support to ecosystem partners is "unlikely to persuade bears," but he himself holds a "constructive" view on the sustainability of diversified AI infrastructure spending and NVIDIA's position as a "core enabler."
Overall, Buchalter believes that this earnings report yields a "net positive for bulls" and explicitly stated that NVIDIA's stock price is "significantly undervalued." Schneider from Goldman Sachs added that this outlook "may alleviate investor concerns about high capital expenditure costs."
Analysts expect NVIDIA's revenue for the current fiscal year to reach $403.5 billion. From the current fiscal year to the $1 trillion target, whether NVIDIA can transform supply constraints into room for growth will be the key variable determining whether this expectation can be realized.