Oppenheimer: Don't Expect Nvidia's Guidance to Beat Estimates on May 28
All eyes will be on Nvidia (NVDA) later today as the chipmaker is forecast to announce its fiscal Q1 2026 results after the market closes today. Valued at a market cap of $3.3 trillion, the semiconductor giant is at the center of the artificial intelligence megatrend, generating game-changing returns for shareholders over the last decade.
Analysts tracking Nvidia expect it to report revenue of $43.25 billion and adjusted earnings per share of $0.75 per share in fiscal Q1. In the year-ago period, it reported revenue of $26 billion and earnings of $0.61 per share. So, while sales are forecast to grow by 66%, earnings are estimated to expand by 24% year over year.
Oppenheimer analyst Rick Schafer expects Nvidia to exceed Q1 consensus estimates, driven by recovering GB200 production and strong Blackwell chip volumes, targeting over 40,000 units this year. However, China's H20 chip restrictions may impact near-term growth despite the upcoming GB300 launch.
While top hyperscale customers represent half of sales, Nvidia's diversified customer base should help mitigate geographic headwinds. Schafer maintains an 'Outperform' rating with a $175 price target, citing Nvidia's full-stack AI advantage and integrated ecosystem. Investors are likely to focus on Q2 guidance for signs of China impact, as cautious commentary could trigger sector-wide revaluation given stretched AI valuations. Schafer says that guidance is likely to be 'in line' with estimates, but not likely to beat estimates.
For fiscal 2026, Wall Street estimates sales to reach $199 billion with earnings per share of $4.16.
Nvidia Continues to Expand Partnerships With Tech Giants
The artificial intelligence revolution is driving unprecedented collaboration among technology leaders as companies rush to build the infrastructure that powers the next generation of intelligent applications.
Microsoft (MSFT) and Nvidia are deepening their partnership to advance agentic AI capabilities across cloud and PC platforms. Microsoft unveiled Discovery, an extensible research platform integrating Nvidia's ALCHEMI and BioNeMo microservices to accelerate materials science and drug discovery. In testing, researchers detected a novel coolant prototype in under 200 hours, compared to traditional methods that require months or years.
Azure is rapidly deploying hundreds of thousands of Nvidia Blackwell GPUs through GB200 NVL72 rack-scale systems, with each AI data center expected to deliver 10x the performance of today's fastest supercomputers. The new Azure ND GB200 v6 virtual machines offer up to 35 times more inference throughput compared to previous H100-based systems, powered by 100% renewable energy.
Dell Technologies (DELL) projects its AI server business will reach at least $15 billion this year, manufacturing servers with Nvidia Blackwell chips that offer 50 times more AI reasoning output than previous generations. Dell's streamlined manufacturing process can build, test, and ship complete rack systems within 24 hours, having recently deployed 100,000 Nvidia GPUs for a major customer in just six weeks.
Google Cloud (GOOGL) became the first provider offering both Nvidia HGX B200 and GB200 NVL72 systems, with A4X virtual machines delivering over one exaflop of compute per rack. The partnership extends to on-premises deployment through Google Distributed Cloud, enabling secure Gemini model deployment for organizations with strict regulatory requirements.
These strategic alliances underscore the massive infrastructure investments required to support global AI adoption as countries and companies transition from experimentation to large-scale implementation.
What Is the Target Price for NVDA Stock?
Nvidia's growth story is far from over, given the tech giant is forecast to increase sales from $130.5 billion in fiscal 2025 to $299 billion in fiscal 2029. Comparatively, adjusted earnings are projected to increase from $2.99 per share to $6.73 per share in this period.
Nvidia stock trades at a forward price-earnings multiple of 33x, above its 10-year average of 36x. If the tech stock is priced at 25x forward earnings, it trades around $170 in early 2028, above the current price of $135.50.
Out of the 44 analysts covering NVDA stock, 37 recommend 'Strong Buy,' two recommend 'Moderate Buy,' four recommend 'Hold,' and one recommends 'Sell.' The average target price for Nvidia stock is $167, indicating upside potential of over 20% from current levels.
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