According to a research report by CMB International, NVIDIA (NVDA, Financial) has revised its asset impairment forecast due to export restrictions, reducing it to $4.5 billion from the earlier estimate of $5.5 billion. The company anticipates the impact on revenue for the first and second quarters of fiscal year 2026 to be $2.5 billion and $8.0 billion, respectively, with significant impact expected by the second quarter.
NVIDIA predicts that its Blackwell product will contribute nearly 70% of its data center computing revenue. The Blackwell Ultra system, based on the GB300 model, began testing this month, with shipments potentially starting in the second quarter. Despite low market expectations for China post-earnings, NVIDIA expects to exceed these expectations. Consequently, revenue forecasts for 2025 and 2026 have been increased to $210.2 billion and $267.4 billion, respectively, and non-GAAP earnings per share estimates have been raised to $4.65 and $6.31.
Based on an average P/E ratio of 32x for 2025/26, the target price has been adjusted to $175, maintaining a "Buy" rating for the stock.
