The red-hot rally that began in shares of Nvidia (NASDAQ: NVDA) in late 2022 has now spanned almost two years, propelling the chip giant to deliver an impressive 11x gains during this period.
An investment of merely $100 in Nvidia stock a couple of years back now stands tall at over $1,100. More notably, indications suggest that the company’s phenomenal streak may well be here to stay in 2025, fueled by progressive developments in the artificial intelligence (AI) chip sector.
Strong Blackwell Demand and Improved Supply Set to Propel Nvidia
Forecasts from consensus estimates predict Nvidia to conclude fiscal year 2025 with $125.5 billion in revenue, representing a substantial 125% leap from the prior year. However, analysts at KeyBanc are even more optimistic, eyeing the company’s revenue to reach $130.6 billion in the current fiscal year ending in January 2025.
Nvidia is poised for robust growth this year, driven by the sales surge of its new Blackwell AI processors. The anticipated revenue influx from Blackwell processors has stimulated market watchers, especially after Nvidia’s management emphasized an expectation of securing “several billion dollars in Blackwell revenue” in the fourth quarter of fiscal 2025 during a recent earnings call.
Simultaneously, Nvidia anticipates a boost in the sales of its current-generation Hopper chips, particularly the H100 and H200 processors, in the second half of fiscal 2025 due to heightened demand and enhanced supply. KeyBanc analysts underscore the very strong demand for these Hopper chips, indicating a positive trajectory.
Furthermore, efforts from Nvidia’s suppliers to ramp up chip production are evident, with Foxconn leading the charge by constructing the world’s largest facility dedicated to manufacturing Nvidia’s GB200 Grace Blackwell Superchip. Each of these superchips, priced at $60,000 to $70,000, is seeing considerable demand, particularly for the server systems employing multiple GB200 Superchips.
Optimistic Revenue Projections for Nvidia’s Future
TrendForce projects Nvidia could distribute 60,000 units of GB200 NVL36 servers next year, with each unit commanding an average selling price of $1.8 million. This could potentially translate to Nvidia selling $108 billion worth of GB200 NVL36 servers in the upcoming year.
Mizuho, the Japanese investment bank, forecasts sales of 6.5 to 7 million units of Nvidia’s AI graphics cards in 2025, hinting at potential data center revenue nearing $200 billion in the same year. If these predictions materialize, Nvidia could surpass analysts’ revenue projections for the next fiscal year with flying colors.
The trajectory in Nvidia’s stock performance is indicative of a company well-positioned for further growth in 2025, with analysts foreseeing the company to reach $177 billion in revenue by fiscal 2026.
