Nvidia earnings prompt Wall Street target hikes as AI spending concerns ease

News Editor

2026-08-28 04:16:37

Nvidia’s latest earnings report reset the tone for the AI trade in U.S. equities, leading several major Wall Street firms to raise their price targets on the stock. The company reported second-quarter revenue of $96.2 billion, up 106% year over year, while data center revenue reached $89.0 billion, up 117%. Nvidia also guided for third-quarter revenue of $108.0 billion, above market expectations. A key point in the report was the company’s outlook that revenue will still grow by about 70% in the next fiscal year, easing concerns that AI capital expenditure may be nearing a peak. After the release, Goldman Sachs lifted its target from $285 to $300, Citi raised its target from $300 to $315, JPMorgan moved from $280 to $320, and Bernstein SocGen raised its target to $400. Mizuho, Stifel, Evercore, and Melius also increased their targets. Nvidia shares rose 8.7% on Thursday, adding about $441.5 billion in market value and helping lift the Nasdaq by 1.6% and the S&P 500 by 0.7%. Investors are now watching Rubin production timing, margin levels, China data center revenue, and potential balance sheet commitments tied to partnership financing.

Nvidia’s latest earnings report became a fresh dividing line for the AI trade in U.S. stocks on Aug. 28. The company reported second-quarter revenue of $96.2 billion, up 106% from a year earlier. Data center revenue came in at $89.0 billion, up 117%. Nvidia also gave third-quarter revenue guidance of $108.0 billion, above market expectations.

The more important signal came from its outlook. Nvidia said revenue is still expected to grow by about 70% in the next fiscal year, a forecast that eased market concerns that AI capital spending may be nearing a peak.

Wall Street firms raised price targets after the report

Following the earnings release, major brokerages quickly reset their valuation anchors. Goldman Sachs raised its target price on Nvidia from $285 to $300. Citi lifted its target from $300 to $315. JPMorgan increased its target from $280 to $320. Bernstein SocGen raised its target more sharply, to $400.

Mizuho, Stifel, Evercore, and Melius also moved their targets higher. According to BlockBeats, the broad set of revisions points to narrowing disagreement among sell-side firms over how long demand for AI chips can remain strong.

Stock and index reaction was immediate

The market response was direct. Nvidia rose 8.7% on Thursday, adding about $441.5 billion in market value in a single session. The move also helped push the Nasdaq up 1.6% and the S&P 500 up 0.7%.

Before the report, markets had repeatedly questioned whether the AI trade had become overheated, whether cloud companies would earn sufficient returns on capital spending, and how Nvidia’s more complex financing arrangements should be assessed. This earnings release restored confidence in the AI infrastructure chain.

What the market is watching next

Attention is now shifting to the production ramp of the Rubin platform, whether gross margins can stay elevated, whether Nvidia’s China data center revenue will recover, and whether potential balance sheet commitments will increase after the company pushed AI data center construction through partnership financing.

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