Nvidia Corp.’s rapid growth has Wall Street wondering how long the company can keep up its momentum, but a Goldman Sachs analyst is feeling increasingly upbeat.
Goldman’s Toshiya Hari no longer assumes that the company’s data-center revenue will drop off during the second half of this calendar year. Now, he’s modeling “consistent growth” through the first half of calendar year 2025, fueled by numerous drivers.
Hari is encouraged that large cloud service providers continue to spend up on artificial-intelligence hardware, and notes that Nvidia’s
customer profile is expanding. Further, he likes that the company has multiple new product cycles on the horizon.
“Although there is still a healthy debate as to whether and/or to what extent the company can grow its data-center business beyond CY2024, we are increasingly confident in the business’ sustainability,” Hari wrote.
He boosted his price target on Nvidia shares to $800 from $625, while maintaining his buy rating and keeping the stock on Goldman’s “conviction” list.
Various big technology companies are seeing real benefits from AI in their financial results, with Microsoft Corp. calling out that 6 percentage points of growth in its Azure cloud-computing business came from AI. Meanwhile, Meta Platforms Inc. is realizing monetization benefits in Reels, messaging and more.
These data points “point to sustained strength in demand for accelerated computing,” Hari wrote.
Further, Meta boosted its capital-expenditure guidance for the year, one signal that hyperscaler players plan to continue spending on AI buildouts.
Hari also highlighted that Nvidia has its new H200 and B100 product cycles looming, and these could enhance the company’s positioning even more.
“From a competitive standpoint, although AMD is making good progress with its MI300 platform, we believe Nvidia will remain as the industry gold standard for the foreseeable future given its robust hardware and software offerings and, importantly, the pace at which it continues to innovate,” he wrote.