NVIDIA stock forecast worsens amid geopolitical risks and signs of a trend reversal

While NVIDIA has once again posted record-breaking quarterly revenue, tighter export restrictions on AI chip shipments to China now threaten its long-term dominance in the global AI market. The NVIDIA stock forecast is pessimistic.

NVIDIA Corporation (NASDAQ: NVDA) reported revenue of 44.06 billion USD for Q1 of fiscal year 2026, a 69% year-on-year increase, and a new quarterly record driven by sustained demand for AI infrastructure and accelerated computing. Despite the strong overall figures, revenue from the Data Center segment, although up 73%, fell short of analysts’ expectations, raising concerns that growth may be starting to normalise. A key headwind was the impact of US export restrictions targeting China, which led to a 4.5 billion USD inventory write-off and an estimated 2.5 billion USD in lost quarterly revenue. Jensen Huang warned of strategic risks stemming from reduced access to the Chinese market, noting that the restrictions could accelerate the development of China’s AI industry.

Investors initially reacted positively to NVIDIA’s report. The company’s shares rose by 5.5% following its release, supported by strong guidance for Q2 fiscal 2026. However, the following day, the gains were fully erased, and the stock began to decline. Market participants are increasingly concerned about escalating geopolitical risks related to export controls on China and signs of slowing growth in the company’s core Data Center segment.

This article examines NVIDIA Corporation, outlines its revenue streams, reviews NVIDIA’s Q1 fiscal 2026 performance, and presents an outlook for the next quarter. It also provides a forecast for NVIDIA stock for 2025.

About NVIDIA Corporation

NVIDIA Corporation is a US tech company established in 1993 by Jensen Huang, Chris Malachowsky, and Curtis Priem. Jensen Huang has remained the company’s CEO since its foundation. NVIDIA specialises in producing GPUs, chips for AI, data centres, and autopilot systems. The company plays a key role in developing gaming, professional visualisation, and AI computing. NVIDIA also held a prominent place in the cryptocurrency mining industry as its graphics cards were widely used for mining Bitcoin, Ethereum, and other digital assets. The company went public on 22 January 1999 on the NASDAQ under the NVDA ticker symbol.

NVIDIA Corporation’s main revenue streams

NVIDIA is primarily known for its GPUs, but it has recently expanded into the AI segment, dominating the market with high-performance chips used for AI technology development. The company reports revenues from this segment under the Data Center section. NVIDIA’s business model focuses on several key areas:

• GPUs: this includes the Gaming and Professional Visualization segments. The company supplies the gaming industry with GPUs for gaming PCs, consoles, and other devices, ensuring high-performance gaming experiences. Professional Visualization includes GPU sales for professionals involved in 3D graphics, CAD, animation, video editing, and other tasks that require high computing power
• Data Center: this is one of NVIDIA’s fastest-growing segments. The company develops GPUs and other hardware solutions for data centres, which are used in AI infrastructure, deep learning technologies, cloud computing, and big data processing
• Automotive segment: NVIDIA is actively developing products for the automotive sector, including self-driving platforms and advanced driver-assistance systems (ADAS)
• OEM and Others: this category includes earnings from technology licensing, sales of other chips and solutions for OEM manufacturers, such as laptop and other electronic device producers

NVIDIA diversifies its operations, covering various segments from gaming to data centres and automotive components. The company publishes statistics on the Gaming, Data

Center, Professional Visualization, and Automotive segments in its quarterly reports, while other indicators are included in the Other Revenues section.

NVIDIA Corporation Q2 FY 2025 report

On 28 August 2024, NVIDIA released its earnings report for Q2 fiscal year 2025, which ended on 28 July 2024. Below are the key figures compared to the corresponding period of last year:

• Revenue: 30.04 billion USD (+122%)
• Net income: 16.95 billion USD (+152%)
• Earnings per share: 0.68 USD (+152%)
• Operating profit: 19.94 billion USD (+156%)
• Gross margin: 75.1% (+500 basis points)

Revenue by segment:

• Data Center: 26.27 billion USD (+154%)
• Gaming: 2.88 billion USD (+16%)
• Professional Visualization: 454 million USD (+20%)
• Automotive: 346 million USD (+37%)

In the first half of 2024, NVIDIA returned 15.40 billion USD to shareholders through share repurchases and dividends. As of the end of Q2 2024, the company had 7.50 billion USD remaining for stock buybacks. On 26 August 2024, the Board of Directors approved an additional 50.00 billion USD for share repurchases, with no expiration date.

Although the Q2 fiscal 2025 results surpassed analyst forecasts, NVIDIA shares fell immediately after the release. Investors were not particularly impressed by the revenue and profit growth, as financial indicators had surged from 200% to 700% in the previous quarter. Maintaining such rapid growth over the long term is clearly unrealistic, but investor expectations remain elevated.

A fundamental analysis of NVIDIA’s report showed that revenue increased across all segments. The Data Center segment, which focuses on AI technologies, remained the leader. The company’s operating margin chart below illustrates the extent to which AI has influenced NVIDIA’s performance.

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OpenAI announced ChatGPT on 30 November 2022, and by Q1 2023, NVIDIA reported an increase in its operating margin. It then grew at a rapid pace, even surpassing the levels seen during the cryptocurrency mining boom. In fact, this suggests that the company has been raising product prices without a decline in demand, allowing it to generate more than 50 cents in profit for every dollar invested.

NVIDIA Corporation Q3 FY 2025 report

On 20 November 2024, NVIDIA released its earnings report for Q3 fiscal 2025, which ended on 27 October 2024. Below are the key figures compared to the corresponding period of last year:

• Revenue: 35.08 billion USD (+94%)
• Net income: 19.31 billion USD (+109%)
• Earnings per share: 0.78 USD (+111%)
• Operating profit: 21.86 billion USD (+110%)
• Gross margin: 74.6% (+60 basis points)

Revenue by segment:

• Data Center: 30.77 billion USD (+112%)
• Gaming: 3.27 billion USD (+15%)
• Professional Visualization: 486 million USD (+17%)
• Automotive: 449 million USD (+72%)

Jensen Huang commented on the report, saying that “The age of artificial intelligence is in full steam, driving a global shift to NVIDIA computing,” emphasising the strong demand for the Hopper and Blackwell microarchitecture products, which drove record results in the last quarter.

For Q4 fiscal 2025, NVIDIA forecast revenue of 37.50 billion USD (with a possible deviation of 2%) and a non-GAAP gross margin of 73.5%, reflecting confidence in further growth despite supply restraints, particularly due to the Blackwell production ramp-up.

NVIDIA Corporation Q4 FY 2025 report

On 26 February 2024, NVIDIA published its earnings report for Q4 fiscal 2025, which ended on 26 January 2025. Below are the key figures compared to the corresponding period of last year:

• Revenue: 39.33 billion USD (+78%)
• Net income: 22.09 billion USD (+80%)
• Earnings per share: 0.89 USD (+82%)
• Operating profit: 24.03 billion USD (+77%)
• Gross margin: 73.0% (+300 basis points)

Revenue by segment:

• Data Center: 35.58 billion USD (+93%)
• Gaming: 2.54 billion USD (-11%)
• Professional Visualization: 511 million USD (+10%)
• Automotive: 570 million USD (+103%)

Jensen Huang commented on the Q4 fiscal 2025 earnings report, saying that “artificial intelligence has been developing at an incredible pace, as agentic AI and physical AI are creating the basis for the next AI wave, which will revolutionise the largest industries”, underscoring the company’s key role in the AI boom, which led to record revenues of 39.30 billion USD. He highlighted the strong results of the Data Center segment, which reached 35.60 billion USD thanks to demand for the Hopper and Blackwell microarchitecture solutions.

For Q1 fiscal 2026, NVIDIA expects revenue of 43.00 billion USD (with a possible deviation of 2%) and a non-GAAP gross margin of 71.0%, indicating sustainable growth in the company’s revenue. However, the decline in gross margin raises concerns among investors.

NVIDIA Corporation Q1 FY 2026 report

• Revenue: 44.06 billion USD (+69%)
• Net income: 18.78 billion USD (+26%)
• Earnings per share: 0.76 USD (+27%)
• Operating profit: 21.63 billion USD (+28%)
• Gross margin: 60.5% (-1,790 basis points)

Revenue by segment:

• Data Center: 39.11 billion USD (+73%)
• Gaming: 3.76 billion USD (+42%)
• Professional Visualization: 509 million USD (+20%)
• Automotive: 567 million USD (+72%)

NVIDIA’s Q1 fiscal 2026 report reinforced the company’s leading position in the global AI race despite serious geopolitical and regulatory obstacles. It was a record-breaking quarter, with revenue reaching 44.06 billion USD, up 69% year-on-year. Growth was primarily driven by continued high demand for accelerated computing and AI infrastructure. The Data Center segment, which includes sales of high-performance GPUs to large cloud providers and corporate clients, generated 39.1 billion USD, up 73% from the previous year.

However, the quarter also saw serious challenges. One of the key negative factors remains the US government’s restrictions on the export of advanced AI chips to China. Jensen Huang commented on this situation during a conference call, noting that despite persistent strong demand from China, the company is unable to meet it due to regulatory constraints. As a result, NVIDIA wrote off inventory worth 4.5 billion USD, primarily related to H20 chips intended for the Chinese market, and estimated lost revenue for the quarter at approximately 2.5 billion USD. For Q2 fiscal 2026, the company anticipates a revenue loss of 8 billion USD due to the restrictions.

Huang also expressed concerns about the broader fallout from these trade restrictions, warning that the ban on advanced AI technology exports could inadvertently accelerate the development of China’s domestic semiconductor industry, which could ultimately undermine US global technological leadership. Huang also underscored that revenue from China currently accounts for a smaller part of NVIDIA’s total sales, with losses being significantly offset by growing demand in North America, Europe, and newly emerging markets, including the Middle East.

For Q2 fiscal 2026, NVIDIA expects revenue of approximately 45 billion USD (with a possible deviation of ±2%). This forecast reflects the active rollout of the new Blackwell chip architecture, which, according to Huang, is already seeing unprecedented demand from hyperscalers, government AI development programs, and major corporate clients. The company anticipates that strong demand for hardware solutions and AI software products will persist through the end of this fiscal year.

However, despite continued technological leadership and robust demand for AI solutions, NVIDIA is beginning to show signs of a slowdown in its key Data Center segment. Although revenue increased by 73% year-on-year, the segment fell short of market expectations, which limited the stock’s growth following the report’s release. This may indicate the start of a normalisation phase after the rapid acceleration driven by the AI boom.

Nevertheless, the company continues to demonstrate exceptional financial performance and remains at the forefront of technological innovation. While losses related to export restrictions on China are severe, they are largely being offset by global demand and the rollout of the next-generation Blackwell architecture. NVIDIA’s strategy to diversify its client base and actively expand into regions with rising AI initiatives forms a strong foundation for sustainable growth in fiscal 2026 and the long term.

Expert forecasts for NVIDIA Corporation

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• Barchart: 37 of 44 analysts rated NVIDIA stock as a Strong Buy, three as a Buy, three as a Hold, and one as a Strong Sell. The high target price is 220 USD, while the low one is 100 USD.
• MarketBeat: 39 of 44 specialists gave the stock a Buy rating, four issued a Hold recommendation, and one advised Sell. The high target price is 220 USD, and the low one is 120 USD.
• TipRanks: 36 of 41 respondents assigned a Buy rating to the stock, four recommended Hold, and one suggested Sell. The high target price is 210 USD, while the low one is 100 USD.
• Stock Analysis: 23 of 44 experts rated the stock as a Strong Buy, 18 as a Buy, two as a Hold, and one as a Strong Sell. The high target price is 220 USD, and the low one is 100 USD.

NVIDIA Corporation stock price forecast for 2025

NVDA stock is trading within an ascending channel on the weekly timeframe and is approaching resistance at 143 USD. However, a Head and Shoulders pattern is forming on the chart, signalling a potential price decline. Based on NVIDIA’s stock performance, possible movements in 2025 are outlined below:

The primary forecast for NVIDIA stock suggests a decline to the support level at 75 USD, in line with the signal from the Head and Shoulders technical analysis pattern. If this scenario unfolds, the correction from current levels would be approximately 42% – a significant drop for a company at the forefront of AI development.

Investor interest in NVIDIA shares may rise markedly at the 75 USD level, potentially paving the way for a recovery in NVDA stock price and a return to the all-time high near 153 USD.

The optimistic forecast for NVIDIA stock anticipates a breakout above the 143 USD resistance level, which could drive the price higher towards the upper boundary of the channel at 180 USD.

Risks of investing in NVIDIA Corporation stock

Based on NVIDIA’s management forecast for 2026, investing in the company’s stock carries several risks, which are outlined below:

• One of the key risks for NVIDIA stock investors is slowing revenue growth in the Data Center segment, which has been the main driver of the company’s financial performance in recent years. In Q1 of fiscal 2026, the segment showed 74% year-on-year growth but fell short of analysts’ expectations, raising concerns in the market. Given that the Data Center segment generates more than 80% of the company’s revenue, any slowdown in this area has a disproportionately strong impact on overall business dynamics. The reasons may include partial saturation of AI infrastructure among major hyperscaler clients, delays in the rollout of new solutions, and intensifying competition from other AI hardware providers, as well as from in-house developments by leading technology companies. If the current trend persists, the market may begin to reassess NVIDIA’s future growth potential – especially amid high expectations and record valuations – creating a risk of downward pressure on the stock price in the medium term
• Geopolitical risks and trade restrictions: NVIDIA’s CFO, Colette Kress, has expressed concerns about potential tariffs and export restrictions from the US administration under President Donald Trump, particularly regarding China. These uncertainties could adversely impact the company’s financial performance and its ability to supply key international markets
• Competition and technology risks: the unexpected emergence of Chinese AI startup DeepSeek with its R1 model may lead to reduced AI infrastructure spending and intensify competition for NVIDIA. This could result in weaker demand for the company’s products and a decline in its market share

Given these factors, it is essential to thoroughly assess the risks associated with investing in NVIDIA shares and to make informed decisions based on up-to-date information and prevailing market conditions.