### Nvidia Shares Decline as Analysts Raise Price Targets Ahead of Earnings Report

Nvidia saw a slight dip in its stock price during early trading on Monday but is still on track to add over $350 billion in value this month. This comes as two top Wall Street analysts have updated their price targets for the AI-chip maker in anticipation of its third quarter earnings report next week.

Nvidia recently surpassed Apple to become the world's most valuable company by market capitalization and has also replaced Intel in the Dow Jones Industrial Average. The company's shares have experienced a remarkable 205% gain in 2024. Analysts are looking forward to Nvidia's earnings report scheduled for Wednesday, November 20, where they expect a substantial year-on-year revenue increase of 82%, reaching nearly $33 billion. This surge is attributed to continued demand for its legacy Hopper chips and the successful launch of its new line of Blackwell processors.

Despite providing a Q3 revenue outlook of $32.5 billion in late August, more than double the revenue from the same period last year, Nvidia has faced delays in shipping its new Blackwell processors due to design changes and supply-chain issues. Nvidia's dominance in the AI accelerator market, which supports the large datasets and language models used by tech giants like Google, Microsoft, Amazon, and Meta Platforms, ensures it will likely report impressive revenue gains over the coming year.

CEO Jensen Huang has described the demand for Nvidia's new Blackwell processors as "insane." UBS analysts predict that the four major hyperscalers, who have reported their third-quarter earnings this week, will invest $267 billion in capital projects related to new AI technologies next year, a 33.5% increase from this year's forecast.

Even Tesla, aiming for autonomous robotaxis and self-driving electric vehicles, expects to invest around $11 billion this year, mainly on AI compute. Piper Sandler analyst Harsh Kumar, who raised his price target on Nvidia by $35 to $175 a share, believes that supply constraints will result in only modest revenue gains for the October quarter and the subsequent three months. However, he expects significant AI-driven growth into 2025.

Last week, Jensen Huang requested South Korea's SK Hynix to expedite the delivery of high-bandwidth-memory chips to meet the robust demand. Morgan Stanley analyst Joseph Moore also raised his Nvidia price target by $10 to $160 a share but highlighted that supply constraints could limit Nvidia's ability to significantly revise its revenue forecasts upward. Despite this, he anticipates "several billion" in January-quarter sales for the Blackwell line and modest growth for the Hopper chips.