Nvidia Corp. NVDA is likely to experience an upswing in its growth estimates as the U.S. has lifted chip export curbs to China, bringing the Wall Street estimates about 10% higher, says this expert.
Check out the current price of NVDA stock here.
What Happened: According to Gene Munster, the managing partner at Deepwater Asset Management, the developments on chip exports to China should add back about 10% to Street estimates.
However, he believes that some analysts may have already factored in the return of the H20 chips before the company’s announcement. “That means that Street estimates should rise by about 10% on the news.,” he said, adding that “Either way you look at it. Great news for $NVDA.”
This comes as the tech giant led by Jensen Huang took a hit in their first quarter after it faced an export ban on H20 products to China on April 9.
The company said it incurred a $4.5 billion charge in the first quarter related to H20 excess inventory and purchase obligations. H20 product sales were $4.6 billion for the first quarter before the new export licensing requirements.
Meanwhile, the chipmaker also said that its second-quarter revenue guidance of $45.0 billion, +/- 2%, included the loss of $8.0 billion in H20 revenue due to the export controls.
However, Munster added in a following X post that this development of U.S. lifting supply restrictions on China will also uplift the company’s future earnings. He said the company’s 2026 growth estimates could rise from the current 25% to 30-35% growth.
Why It Matters: According to a company statement, Nvidia announced it will resume sales of its H20 GPU to China and unveiled a new RTX PRO graphics processor designed specifically for Chinese customers.
This followed Huang’s lobbying, including a meeting last week with U.S. President Donald Trump, where Huang reiterated Nvidia's commitment to American job creation and AI leadership.
The new RTX PRO GPU was launched for sale in China to maintain market share while navigating heightened trade restrictions. However, the new development uplifts restrictions from H20 chips as well. The RTX PRO chip is "ideal for digital twin AI for smart factories and logistics," Huang announced.
Price Action: Nvidia shares were up 3.62% overnight on Robinhood, as of the publication of this article. It ended 0.52% lower at $164.07 apiece on Monday. The stock has advanced 18.62% on a year-to-date basis and 27.74% over a year.
Benzinga Edge Stock Rankings shows that NVDA had a stronger price trend over the short, medium, and long term. Its momentum ranking was solid, whereas its value ranking was poor; the details of all the metrics are available here.
The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, rose on Monday. The SPY was up 0.19% at $624.81, while the QQQ advanced 0.36% to $556.21, according to Benzinga Pro data.
On Tuesday, the futures of the S&P 500, Dow Jones, and Nasdaq 100 indices were trading higher.
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