Nvidia CEO Jensen Huang reported a remarkable 78% year-over-year revenue growth, driven by the successful rollout of their complex Blackwell chip, which generated around $11 billion in revenue. KeyBanc’s John Vinh praised Nvidia’s strategic handling of the Chinese market and competition from DeepSeek, expressing optimism about the company’s future performance and maintaining an overweight rating with a price target of $190.
In a recent discussion, Nvidia CEO Jensen Huang highlighted the company’s impressive performance in the fourth quarter, showcasing a significant ramp-up in sales and profits. The company reported a remarkable 78% year-over-year growth in revenue, exceeding market expectations. Huang emphasized the complexity of their Blackwell chip, which is not just a standalone product but part of an entire system, indicating the challenges they faced in its development and rollout.
John Vinh, an equity research analyst from KeyBanc, joined the conversation to provide insights into Nvidia’s handling of key issues, particularly regarding China and competition from DeepSeek. Vinh praised Nvidia’s strategic positioning, noting that while DeepSeek’s AI model requires significantly more computational resources, Nvidia has successfully navigated the complexities of the Chinese market. He pointed out that despite concerns, Nvidia’s revenue from Chinese hyperscalers has surged, indicating strong demand for their H20 GPUs.
The discussion also touched on the performance of the Blackwell chip, which exceeded expectations by generating around $11 billion in revenue, significantly higher than the anticipated $3 to $4 billion. Vinh noted that Nvidia’s data center revenues grew over 90%, suggesting that their business in China also experienced substantial growth. This performance reflects Nvidia’s ability to meet market demands effectively, even amidst logistical and supply chain challenges.
Vinh expressed optimism about Nvidia’s gross margins, suggesting that they are likely to recover to a normalized range in the mid-70s as the company continues to refine its manufacturing processes. He acknowledged the complexity of the new full-stack server systems that Nvidia is shipping, which include a higher number of GPUs, and indicated that the current margin pressures are likely transient.
Finally, the conversation addressed the ongoing concerns regarding export controls and tariffs, particularly in relation to China. Vinh noted that Huang has managed these sensitive topics well so far, and he believes that allowing access to technology is crucial to avoid complications that could arise from restrictions. Vinh maintained an overweight rating on Nvidia with a price target of $190, reinforcing the company’s position as a strong player in the semiconductor industry.