UBS raised its price target on NVIDIA Corp. (NASDAQ:NVDA) to $205 from $175 while maintaining a Buy rating, citing expectations for strong data center revenue ahead of the company’s second-quarter results on August 27.
The brokerage said it sees fiscal Q2 revenue around $46 billion, roughly a $1 billion beat from the prior quarter, and forecast fiscal Q3 revenue of $54 billion to $55 billion excluding China, or as much as $57 billion if China is included.
UBS noted supply chain checks indicated compute could grow 20% to 25% quarter-over-quarter from a $35 billion base in fiscal Q2, potentially adding $7 billion to $8 billion in compute revenue for fiscal Q3. Networking revenue was projected around $6 billion despite supply constraints, implying total data center revenue near $49 billion.
The analysts cautioned that gaming comparisons may be more challenging after a strong fiscal Q1. They also pointed to possible reuse of written-down H20 inventory in China, while suggesting NVIDIA has placed new Hopper wafer orders and continues to work on a Blackwell version, amid expectations the U.S. government may raise export limits as part of rare earth negotiations.
