Nvidia's Blackwell Delay Offers Investors A Chance To 'Add To Positions': Goldman Sachs

Nvidia Corp NVDA finds itself at the center of tech speculation as reports have surfaced about potential delays in its much-anticipated Blackwell architecture.

With tech giants like Nvidia often facing the heat of public and market scrutiny, the slightest hiccup can stir investor unease. But is this delay really a cause for concern, or just a blip on Nvidia’s otherwise smooth journey towards AI supremacy?

According to a report by The Information, Nvidia’s next-gen Blackwell chips might hit a speed bump, delaying their release by over three months due to alleged design flaws. These chips were set to ship later this year, boasting promises of up to 30x better Inference performance over their predecessors. Despite this setback, Toshiya Hari of Goldman Sachs advises investors to remain calm and continue with their current strategies.

The delay, while not ideal, is unlikely to impact Nvidia's 2025 earnings power or its market dominance, according to Hari. “We expect there to be little to no impact on CY2025 earnings and, most importantly, the company's long-term competitive position.” Hari believes that any short-term volatility in Nvidia's fundamentals will be just that—short-lived.

The Market Reaction: Opportunity Or Overreaction?

For those ready to jump ship, Hari's advice is clear: stay the course. Nvidia's stock might experience some turbulence, but the company’s strong footing in the AI market isn't going anywhere. “We would consider any near-term dislocation in the stock as an opportunity to add to positions.”

Despite a recent 15% correction, Nvidia remains a top pick, firmly seated on Goldman's Americas Conviction List with a 12-month price target of $135, suggesting a potential upside of nearly 26%.

Even with Blackwell’s reported delays, Nvidia’s projected 39% year-over-year growth in 2025 remains unchanged. Hari’s bullish stance is rooted in Nvidia’s role as a crucial player in the rapidly evolving AI sector, especially as the demand for advanced AI infrastructure shows no signs of slowing down.

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Implications For Rival – AMD

Interestingly, while the Blackwell delays might appear as a dark cloud over Nvidia, there could be a silver lining for competitors like Advanced Micro Devices, Inc AMD. “We believe the market could perceive this development as a marginal positive for AMD — the only alternative to Nvidia today in Data Center GPUs.” Although the analysts say AMD is unlikely to overtake Nvidia due to Nvidia’s strong market position and AMD’s challenges in scaling operations

What’s Next For Nvidia?

In the tech world, where speed and innovation reign supreme, a three-month delay might seem significant. However, Nvidia’s legacy of innovation and market leadership paints a different picture. As Hari points out, “any impact to CY2025 earnings will be negligible,” and the temporary setback should not deter investors from seeing Nvidia’s long-term value.

For now, Nvidia’s strategy remains rock solid. The potential delay, whether factual or exaggerated, is but a temporary hurdle, according to Hari. As Nvidia navigates this challenge, the market watches closely, with many investors seeing a buying opportunity amid the noise. For those invested in Nvidia's future, Hari’s message is clear: hold steady, as the AI revolution waits for no one.

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