Nvidia shares rose steadily in early trading on Monday, putting them within striking distance of a new record peak, after CEO Jensen Huang outlined details of a new line of chips and processors that could further cement its control in the global ai market.
NVIDIA (NVDA) which added just over $500 million in market value over the last month alone, is up more than 127% year-to-date to claim its place as the top tech stock and the world's third-largest company .
The group's 80% market share for graphics chips and central processors that power massive ai data sets from hyperscalers like Meta Platforms. (GOAL) microsoft (MSFT) and alphabet (GOOG) has brought the Santa Clara, California group billions in new revenue along with impressive profit margins.
Data center sales, which include the group's key ai offerings, rose more than five-fold from a year earlier to a record $22.6 billion during the three months ended April and gross profit margins soared. expanded to 78.9%.
Nvidia also said current quarter revenue would rise to around $28 billion, with a 2% margin of error, even as it noted that its new Blackwell system of processors and software would not begin shipping until the second half of the year. .
The new Blackwell GPU architecture, named after African-American mathematician David Harold Blackwell, performs ai tasks at more than twice the speed of Nvidia's current Hopper chips, while using less power and providing more custom flexibility, the technology group said . It is expected to hit the market next year.
From Blackwell to Rubin
Huang added another layer of demand potential to Nvidia's growing lineup during a speech at National Taiwan University in Taipei over the weekend, where he revealed details of a new family of chips and processors called Rubin.
The new Rubin systems, named after American astronomer Vera Rubin, who is credited with the discovery of so-called dark matter, will be deployed in 2026, Huang said.
Related: Analysts revise Nvidia stock price targets as earnings address key issue
“Our company has a one-year pace,” Huang said. “Our basic philosophy is very simple: build the entire scale of the data center, disaggregate and sell parts to it on a one-year pace, and push everything to the technological limits.”
BofA Securities analyst Vivek Arya said the new announcements, which effectively accelerate the group's product cycle from two years to one year, “will continue to reinforce Nvidia's ai leadership position.”
Arya and his team raised their Nvidia price target by $180 to $1,500 per share, rating the stock as a top pick while maintaining a Buy rating.
Nvidia Earning Power
“We continue to believe that Nvidia's turnkey system design could sustain more than 80% of the market share in ai accelerators and generate sustained growth in networking (the Ethernet shift will already reach multi-billion dollar levels within a year).” said the B of A team.
“With potentially faster adoption of Blackwell (mainstream ai rise), we see EPS potential of over $50 in two years,” the bank added.
Related: Nvidia earnings seal dominance of Big tech stocks
Meanwhile, analysts at Evercore ISI noted that Nvidia's pending 10-for-1 split could add an extra dimension of volatility to the market's top stocks. Shares are scheduled to begin trading after the split on Monday, June 10.
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In fact, Nvidia shares have risen nearly 15.5% since the group reported better-than-expected fiscal first-quarter earnings on May 22, while the S&P 500 fell 0.55% and the Nasdaq fell 1 0.4%.
That divergence could suggest that Nvidia's recent market leadership is starting to fade as it has failed to drag broader indices with it, Evercore said. “There is no precedent for a stock the size of Nvidia to have its post-earnings rise 'ignored' by the broader S&P 500,” the investment firm said.
Nvidia shares rose 3.3% in premarket trading, indicating an opening price of $1,133.60.
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