Nvidia shares rose ahead of this week’s high-profile developer conference as investors bet the event would yield new insights about the sustainability of the artificial intelligence spending boom and the chipmaker’s next generation of processors. Shares rose about 2% on Monday ahead of the company’s annual GTC conference. CEO Jensen Huang will deliver the keynote address at 2pm ET at the GTC conference. The gathering is an important venue for Nvidia to outline its technology roadmap and strengthen investor confidence in demand for AI infrastructure. AI Spending Debate Analysts say the biggest question hanging over the semiconductor sector is whether hyperscalers’ spending on AI hardware can remain as strong as it has been over the past two years. “We believe NVIDIA will catch up with other stocks in the supply chain, and we think this is a very good entry point,” Morgan Stanley analysts said in a preview note, reiterating NVIDIA as a top semiconductor candidate. The company said the conference could help address investor debate over Nvidia’s long-term market share as competitors such as Advanced Micro Devices and custom AI chips gain momentum. Wells Fargo analysts said the poor performance of Nvidia’s overall semiconductor division this year has been a frequent topic of discussion among investors. The stock is down about 3% since the beginning of the year, compared to an 8% rise in the VanEck Semiconductor ETF. NVDA YTD Mountain Nvidia Year-to-date Long-term Targets While GTC could act as a catalyst, Wells Fargo said expectations are already high, with buy-side estimates for NVIDIA’s 2027 earnings hovering around $13 per share. This is the level at which future architectures such as Vera Rubin are already envisioned for success. Instead, Wells Fargo said clearer long-term goals could lead to a rekindling of the stock price. Analysts noted that rivals such as Broadcom, Marvell Technology and AMD all discuss multi-year outlooks, while Nvidia typically provides only short-term guidance. “A solid bogey for NVDA in CY27 could provide the positive catalyst needed to make the stock work,” Wells Fargo said. Analysts at Wolf Research also said investors are eager for signals about the size of future demand. The company said NVIDIA may provide new disclosures about its AI-related revenue outlook for 2026 and 2027, and this could be a potential catalyst if the company provides stronger long-term demand signals. Stock buybacks Another factor could be capital returns. Nvidia reported having more than $60 billion in cash on its balance sheet in its latest quarterly report, but Wall Street has modeled free cash flow in 2026 and 2027 at about $180 billion and $240 billion, respectively. Wells Fargo said its latest share buyback strategy announced at the conference could further boost its stock price. Pipeline and Roadmap Bank of America analysts expect the conference to focus on Nvidia’s future product pipeline and customized AI systems designed for inference. The bank said investors will likely focus on updates extending the company’s roadmap through the so-called Feynman generation of GPUs expected in the second half of this decade, with potential commentary on the rollout of the Rubin architecture scheduled for 2027 and beyond. Bank of America maintained a buy rating on the stock, calling Nvidia the “leading AI stock trading at an all-time low of 17 times forward earnings.” Other analysts are focused on technology announcements that could signal Nvidia’s next wave of growth. Mizuho analysts said the conference could also include details on the new Rubin Rack platform, expected to launch in late 2026, as well as updates on networking, optical interconnects and purpose-built inference processors designed to dramatically improve performance. The company also flagged potential discussions about quantum computing efforts, including technology aimed at linking graphics processors and quantum processors in hybrid supercomputing systems. —CNBC’s Michael Bloom contributed reporting.
