Nvidia Surges as Much as 8% Pre-Market as Wall Street Raises Price Targets

TradingKey - In Thursday's US pre-market trading, Nvidia (NVDA) shares surged, with gains extending to as much as 8%, on track to break a previous pattern of consecutive post-earnings declines.

Source: TradingView

After the market close on Wednesday local time, Nvidia reported its second-quarter fiscal 2027 results. Quarterly revenue reached $96.2 billion, up 106% year-over-year, while adjusted earnings per share came in at $2.22, up 120% year-over-year, both beating Wall Street expectations.

Meanwhile, the company expects third-quarter revenue to reach $108 billion and, for the first time, disclosed growth expectations for fiscal 2028 a year in advance, forecasting revenue growth of about 70%. This growth rate is significantly higher than the market's previous estimate of around 45%, signaling that Nvidia believes AI infrastructure investment will remain highly robust.

It was precisely this better-than-expected forward guidance that served as the primary catalyst driving the sharp rally in the stock price.

Investors had previously worried that AI capital expenditures by major tech companies might gradually cool down. However, the signal sent by Nvidia's latest outlook was quite the opposite: demand for AI chips remains strong, and demand is expanding from a few large cloud providers to AI labs, enterprise clients, and emerging AI companies.

Jensen Huang also stated that the company's primary constraint currently stems from supply capacity rather than a lack of demand.

Following the earnings release, Wall Street acted quickly, with several firms raising their price targets for Nvidia. According to data compiled by LSEG, at least 10 brokerages raised their target prices after the earnings report.

Among them, JPMorgan (JPM) raised its target price from $280 to $320; Melius Research raised its target from $400 to $420; Mizuho Securities raised its target price from $300 to $315. Goldman Sachs (GS) and Morgan Stanley (MS) also further raised their price targets for Nvidia.

In addition, the strong performance of Nvidia's stock also drove the entire AI supply chain higher. In Thursday's US pre-market trading, Micron Technology (MU), Marvell Technology (MRVL), Arm (ARM), and Intel (INTC) and other chip stocks rallied across the board, while AI cloud service companies such as CoreWeave (CRWV) and Nebius (NBIS) also performed strongly.