Analysts revise Nvidia's stock price targets following Q2 earnings report.

Nvidia shares dipped in early Thursday trading but managed to recover somewhat from their post-earnings decline, as numerous Wall Street analysts swiftly revised their ratings and price targets following the company's eagerly awaited July-quarter report.

Nvidia (NVDA), a leader in manufacturing the chips and processors that power AI systems globally, reported record revenue of $30.04 billion for its fiscal second quarter, with profits more than doubling from the same period last year to 68 cents per share.

The company indicated that revenue for the current quarter is expected to keep rising, although at a slower rate, projecting a top-line figure of $32.5 billion. This outlook comes despite delays in shipping its new Blackwell processors due to design changes and supply chain issues.

Nvidia announced it has made adjustments to the Blackwell graphics-processing unit mask to enhance production yields. The ramp-up is set to begin in the fourth quarter and extend into fiscal 2026.

During a conference call late Wednesday, CEO Jensen Huang informed investors, "We are currently sampling functional prototypes of Blackwell, Grace Blackwell, and various system configurations. There are about 100 different types of Blackwell-based systems, and we’re enabling our ecosystem to start sampling those."

Huang emphasized the "incredible" demand for the new Blackwell GPUs, stating, "The functionality of Blackwell is as it is, and we expect to start shipping out in Q4." He also noted strong demand for Nvidia's existing Hopper chips.

CFO Colette Kress mentioned that Blackwell is anticipated to generate "several billion" in revenue for Nvidia's fiscal fourth quarter, which ends in January, and that sales of Hopper chips are expected to increase during the latter half of the year. This reassurance is significant for investors who had concerns that the Blackwell launch might lead to cancellations or delays in Hopper orders.

However, the ramp-up of Blackwell is likely to impact Nvidia's profit margins, which narrowed slightly to 75.7% in the second quarter and are expected to stabilize around 75% in the near term.

Goldman Sachs analyst Toshiya Hari noted that despite lower-than-expected gross margin guidance, Nvidia's data center revenue potential across cloud, consumer internet, and enterprise customers remains robust. He maintained his conviction-buy rating and $135 price target on Nvidia stock after the earnings update.