Nvidia Thrives Amid $8 Billion Export Hit and Strong Buy Rating from Analysts
Published on 5.31.25
Nvidia's recent earnings report has highlighted its resilience in the face of significant export constraints imposed by the US government, with a $4.5 billion hit from these restrictions being less than anticipated. The company's Chief Financial Officer Colette Kress warned that export constraints are expected to cost Nvidia about $8 billion in the current quarter, underscoring the impact of these regulations on the industry leader.
Despite this setback, Nvidia is adapting quickly and has been praised by analysts who have given it a Strong Buy rating with an average stock price target of $164.51, implying a 25.30% upside. The company's gaming chip business saw a record high of $3.8 billion, with revenue leaping 48%. This growth is a testament to Nvidia's ability to innovate and diversify its offerings.
The company plans to use its AI technology center in Sweden to boost defense capabilities and tap into areas like drug discovery and 5G networks. To stay competitive in China's data center market without violating US export controls, Nvidia launched a lower-spec AI chip, the RTX Pro 6000D or B40, priced between $6,500 and $8,000.
The company's data center division revenue increased 10% to $39.1 billion, demonstrating its continued dominance in the market. Nvidia CEO Jensen Huang expressed concerns that the US export constraints are based on an assumption that China cannot make AI chips, which he believes has been proven wrong. This strategic move highlights Nvidia's ability to navigate complex regulatory environments while maintaining its position as a leader in the AI industry.