Stock Futures Little Changed as S&P 500 Looks to Add to Record High; Nvidia Shares Slip After Earnings

Morgan Stanley Analysts Bullish on Nvidia Outlook

Just Now

Nvidia’s (NVDA) outlook for the third quarter was met with a bullish reception from analysts at Morgan Stanley.

The company at the center of the AI boom projected third-quarter revenue of $54 billion, plus or minus 2%, a record level but a tepid forecast versus estimates of around $53.8 billion. Nvidia issued its projection as it posted better-than-estimated second-quarter results, although key data center business revenue lagged forecasts.

Morgan Stanley raised its price target on the stock to $210 from $206 and kept its overweight call on the stock, saying Nvidia shares are “less expensive than other AI beneficiaries.” They said the “bar [set by Nvidia] continues to be high but the growth acceleration is clear.”

“For the stock to sell off slightly after hours on these types of numbers certainly indicates that sentiment has largely caught up to the growth potential, after fears of digestion just a few weeks ago,” they wrote. “But outside of China geopolitics, this is a very clean beat and raise quarter.”

Nvidia shares were down slightly at $181 in recent premarket trading, after falling sharply in extended trading hours late Wednesday immediately following the earnings release.

Nvidia CFO Collette Kress said during the earnings call Thursday that the company hasn’t restarted sales of its H20 chips in China yet while the company waits for the U.S. government to formalize its revenue-sharing agreement. Earlier this year, the Trump administration blocked Nvidia’s sale of its H20 chips, which the company tailored for the Chinese market, then this month struck a deal where Nvidia would give the government 15% of China chip revenues in exchange for resumed sales.

–Nisha Gopalan