Nvidia Corp. – No change in the growth story

Nvidia Corp. – No change in the growth story

Recommendation : BUY (Maintained); TP: US$155.00, Last Close: US$125.61

2Q25 results exceeded expectations on still strong AI demand and continued supply ramp. Revenue beat NVDA’s own guidance by 7%, and PATMI jumped >2.5x YoY. 1H25 revenue/PATMI was at 46%/49% of our FY25e forecasts.
2.5x YoY growth supported by demand from Hyperscalers (45% of revenue), Enterprises, and Sovereign nations. Forward guidance still implies 80% YoY growth in 3Q25e, while NVDA expects supply-demand equilibrium to be reached in mid-FY26e as it ramps supply at ~US$4bn/quarter to meet the initial surge in demand.
We raise our FY25e/FY26e revenue/PATMI by 8% to reflect stronger ramp-up of its Data Centre AI accelerator platforms (Hopper + Blackwell). Our margin assumptions are unchanged. We maintain BUY with a raised target price of US$155 (prev. US$140). Our WACC/g is unchanged (6.8%/4.5%). NVDA still dominates (~90% share) AI GPUs, which are benefitting from secular tailwinds from a shift to accelerated computing and increasingly complex Gen AI models. Thank you