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Amidst a global rout of equities and technology stocks, NVIDIA's shares were dealt another blow after Citi reduced its 2025 sales estimate for NVIDIA and removed the shares from its 30 day catalyst watch. The bank kept its $150 share price target for NVIDIA and a Buy rating, adding that the feverish demand for the firm's H100 and H200 chips could help it mitigate some of the impact from the purported Blackwell delay.
An NVIDIA statement given to Wccftech earlier had refused to comment on rumors and shared that Blackwell was on track to ramp up in the second half of this year. An hour before trading, its shares had lost 14% in pre market, as they led the broader technology sector's declines.
Citi Removes NVIDIA From 30-Day Catalyst Watch, Keeps Price Target At $150
The current volatility in US equities follows after a worrying jobs report last week coupled with an interest rate hike in Japan, which became the latest in the upset of the delicate link of variables that underpin the global financial system. Over the weekend, Warren Buffett's Berkshire Hathaway also cut its stake in Apple, indicating to some investors that Buffett is now holding hundreds of billions of dollars in cash as he anticipates a recession on the horizon.
For NVIDIA, whose shares have lost more than 20% since they peaked earlier this year to allow it to become the most valuable company in the world, August has come with a double whammy of sorts. After an earlier report claimed that its leading edge Blackwell AI processors might be delayed, the stock was caught up in the current storm surrounding technology equities with the latest report from Citi further adding to its woes.
According to Citi, a potential three month delay in NVIDIA's Blackwell chips can lead to some customers "increasing their demand of H100/H200" chips, which should help NVIDIA mitigate the impact of the sales decline in its quarter ending January 2025. The bank keeps its estimates of NVIDIA sales for this year's quarters intact, and it has shifted its January 2025 quarter NVIDIA Blackwell sales estimate by 15%.
Citi believes NVIDIA will lead the AI GPU market in the long term by commanding a 90% market share, but in case the delay materializes, the company's smaller rival AMD could end up benefiting. Since the bank believes that any impact on the January sales will be shifted forward to the April quarter, it is leaving its "FY26 (CY25) estimates mostly unchanged and now assume[s] potential US restrictions on B20 AI GPUs shipped to China next year."
The report that had claimed a delay for NVIDIA's Blackwell chips also highlighted that the firm had informed some of its largest customers about the delay. Another report in the Chinese press had outlined that NVIDIA's manufacturing partner TSMC had purportedly spotted a problem with the chip's interconnect, and an NVIDIA statement in response had noted that "Hopper demand is very strong, broad Blackwell sampling has started, and production is on track to ramp in 2H. Beyond that, we don't comment on rumors.”
About the author: Ramish is a seasoned technology writer and editor with more than a decade of experience. He specializes in semiconductor fabrication and market analysis. With a background in finance and supply chain management - via his bachelors in Finance and a micromasters in supply chain management from MIT - Ramish combines financial rigor with deep industry insight to deliver accurate and authoritative coverage.
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