NVIDIA is experiencing a "Taylor Swift moment": leading the AI revolution, with the stock price expected to soar.

Zhitong App learned that Dan Ives, a senior analyst from the well-known Wall Street investment firm Wedbush Securities, described NVIDIA's performance for the fourth quarter of the 2024 fiscal year ending on January 28 as a "Taylor Swift Moment" for NVIDIA. Analyst Ives commented on NVIDIA's record-breaking quarterly performance, stating: "This (NVIDIA's performance) injects strong momentum into the tech stock bull market. I would call it NVIDIA's 'Taylor Swift Moment,' as well as one of the most significant performances we have seen in the global market in the past 5 years."

Typically, a "Taylor Swift Moment" metaphorically refers to a significant event that changes the fate of a person or thing, often leading to a new level of success. Here, Dan Ives refers to NVIDIA reaching a crucial "tipping point," potentially leading the global AI revolution and driving NVIDIA's stock price and the momentum of the tech stock bull market, much like how pop singer Taylor Swift leads the global digital music payment trend with each new album significantly impacting the global pop music scene. Importantly, Taylor's concerts can even bring significant economic benefits to the hosting venues.

Following NVIDIA's explosive performance announcement, the stock price surged nearly 11% to $746 in after-hours trading on the US stock market. Driven by NVIDIA's better-than-expected performance and optimistic outlook, chip stocks in Japan and South Korea collectively rose, with Tokyo electronics stocks up over 5%, Renesas Electronics up over 5%, and SK Hynix up over 4%. Similarly, tech stocks in Taiwan also experienced a significant surge, with TSMC's stock in Taiwan rising over 2%, and MediaTek and Pegatron up over 3%.

NVIDIA - Undoubtedly the "Strongest Shovel Seller" in the Global AI Field

Dan Ives, a senior analyst at Wedbush, also mentioned in an interview that the global AI revolution has arrived, with NVIDIA leading the charge, and NVIDIA CEO Jensen Huang proving his status as the "AI Godfather." Prior to NVIDIA's earnings report, the Wedbush analysis team was optimistic about NVIDIA's short-term push towards $800.

Gene Munster, Managing Partner and Co-Founder of Deepwater Asset Management, believes that the latest performance is just the first of many "AI waves" that will drive NVIDIA's stock price to much higher levels. Munster wrote in an article on X social platform that in the long term, NVIDIA's strong revenue growth is expected to continue. "We are now in the early stages of the first AI infrastructure revolution, with the global shift to GPU systems in super-large data centers just beginning." In the early hours of Thursday Beijing time, NVIDIA once again announced incredibly strong quarterly performance and significantly exceeded market expectations for its performance outlook. The global demand for NVIDIA AI chips has surged across various industries, leading this tech giant to shock the world with another strong performance after three previous quarters.

In the fourth quarter of the 2024 fiscal year ending on January 28, NVIDIA's total revenue more than doubled to $22.1 billion. Excluding certain items, the earnings per share under the NON-GAAP criteria were $5.16, significantly surpassing the Wall Street analysts' general forecast of $20.4 billion in revenue and an expected EPS of $4.60. NVIDIA's core business segment, the Data Center Business Unit providing A100/H100 chips for global data centers, has been the top-performing segment for several quarters, with the Q4 revenue reaching $18.4 billion, a staggering increase of about 409% compared to the same period last year.

More importantly, NVIDIA's performance outlook projects a total revenue of around $24 billion for the first quarter of the 2025 fiscal year (ending in late April 2024). This figure significantly exceeds the Wall Street analysts' average forecast of $21.9 billion. This incredibly strong performance outlook highlights NVIDIA as the prime beneficiary of the global AI trend, earning the title of the "strongest shovel seller" in the AI field.

NVIDIA CEO Jensen Huang stated at the performance meeting: "GPU-accelerated computing and AI have reached a 'tipping point.' The demand from companies, industries, and most countries worldwide is skyrocketing."

During the meeting, Huang also mentioned that NVIDIA's latest products will continue to be in high demand for the remainder of the year. He noted that despite the increasing supply, the demand has not shown any signs of slowing down. "Generative AI has initiated a new investment cycle." "The scale of future data center infrastructure will double in five years, representing a market opportunity of hundreds of billions of dollars annually."

Top Wall Street players are bullish! Stock price on a long-term bullish trend

The latest performance and outlook prove that NVIDIA remains the undisputed "strongest shovel seller" in the global AI field, with a dominant 90% share in AI training and capitalizing on the unprecedented global AI trend. NVIDIA has been deeply rooted in the global high-performance computing field for many years, especially with its CUDA computing platform, which is popular worldwide and serves as the preferred software-hardware collaborative system for high-performance computing in AI training/inference and other fields. NVIDIA's hottest AI chip, the H100 GPU accelerator, is based on NVIDIA's groundbreaking Hopper GPU architecture, providing unprecedented computing power, especially in floating-point operations, tensor core performance, and AI-specific acceleration.

According to the latest forecast by market research firm Gartner, the AI chip market is expected to grow by 25.6% by 2024, reaching $67.1 billion. By 2027, the AI chip market is projected to more than double the size in 2023, reaching $119.4 billion.

However, NVIDIA's strongest competitor, AMD, has even more optimistic expectations for the future AI chip market. At the "Advancing AI" event, NVIDIA's strongest competitor, AMD, raised its global AI chip market size forecast to $400 billion by 2027, up from the previous estimate of $150 billion, with the 2023 AI market size expected to be around $30 billion.

In terms of stock price expectations, before NVIDIA's latest performance and outlook were released, top Wall Street investment firms were bullish on NVIDIA's stock price trend over the next 12 months.

Among them, Goldman Sachs significantly raised its 12-month target price for NVIDIA from $625 to $800 (as of Wednesday's closing price of $674.72), Bank of America raised NVIDIA's target price from $700 to $800, UBS raised its target price from $580 to $850, and Mizuho Securities raised NVIDIA's target price from $625 to $825.

Some institutions even expect NVIDIA's stock price to exceed $1,000 in the next 12 months before the financial report is released. Rosenblatt reiterated a "buy" rating for NVIDIA with a target price of $1,100, while Loop Capital set NVIDIA's target stock price as high as $1,200, the highest on Wall Street.

After NVIDIA announced its performance, some investment firms quickly raised NVIDIA's target stock price. Bernstein raised NVIDIA's target price from $700 to $1,000; Melius Research raised NVIDIA's target price from $925 to $1,000.