Nvidia Set for Strong Earnings as AI Boom Continues: Wedbush Securities Remains Bullish

Nvidia is poised to report another impressive quarter, driven by the ongoing AI investment surge, according to Wedbush Securities. The investment firm, which has affectionately referred to Nvidia founder Jensen Huang as the “Godfather of AI,” maintains a bullish outlook ahead of Nvidia’s second-quarter earnings report scheduled for August 28.

Wedbush’s senior vice president of equity research, Matt Bryson, noted that the anticipated $1 trillion “tidal wave” of AI spending is currently in progress, with technology companies still in the early phases of investing in AI hardware. This optimistic forecast is bolstered by the sustained demand for Nvidia’s AI chips, despite recent market concerns.

Bryson addressed fears surrounding Nvidia’s chip demand and potential issues with the upcoming Blackwell GPU, stating that the recent drop in Nvidia’s share price was a reaction to these uncertainties. However, positive financial results from some of Nvidia’s major clients, including Foxconn and Supermicro, indicate robust growth driven by increased AI investments.

Foxconn, a significant purchaser of Nvidia’s chips, reported a 6% profit increase last quarter, attributed to strong AI server growth. Similarly, Supermicro exceeded revenue expectations, though it fell short on earnings. Bryson highlighted that these data points suggest AI spending remains strong and is likely to continue bolstering Nvidia’s performance.

Additionally, Bryson anticipates that the integration of AI into personal devices will further boost demand for semiconductor products. Despite delays in the release of Nvidia’s Blackwell chips, Bryson believes this will not significantly impact Nvidia’s trajectory, as the company’s customers remain committed to AI investments.

With a continued positive outlook, Bryson maintains a ‘buy’ rating on Nvidia, expecting another successful quarter for the chipmaker, with ongoing momentum from its customer base likely to drive further growth.

Relevant Links

• Wedbush Securities
• CNBC Interview with Matt Bryson
• Foxconn Financial Results
• Supermicro Revenue Report