Ahead of the chipmaker's Q4 report, the tech analyst says Nvidia's sales could grow 65% this year and 40% next year, well above analysts’ projections.
- Nvidia will report fourth-quarter results on Wednesday, with analysts expecting a 67% growth in revenue.
- Higher capex from cloud companies, growing inference demand, and a potentially favourable outcome in the holdup in Nvidia’s China business would lift sales substantially.
- NVDA stock has been muted so far this year, and the latest Stocktwits sentiment shows a ‘bearish’ reading.
As investors brace for Nvidia’s fourth-quarter report on Wednesday, Deepwater Management founder Gene Munster is spotlighting longer-term growth projections, arguing that Wall Street analysts are overlooking what he sees as the best-case scenario for the AI chipmaker.
Munster said that the AI data center buildout is only in the “second innings.” Citing massive spending plans by cloud giants and rising demand for inference – the stage where trained AI models make real-time predictions, an area where Nvidia’s chips excel – he projected that Nvidia’s sales will surge 65% this year and 40% in 2027, well above analysts’ expectations of 55% growth and 28% growth, respectively.
“Investors are left with a basic question: do you believe inference will be significantly bigger than training, that physical AI is a large market, and that Nvidia can maintain its advantage versus custom silicon,” Munster wrote in his blog.
“If the answer is no, the stock is difficult to own. If the answer is yes, then the Street’s roughly 28% growth view for CY27 will prove too conservative. We believe CY27 can grow closer to 40% over CY26 because we are still in the second inning of the AI buildout, and Nvidia remains one of the clearest beneficiaries of that timeline.”
Upcoming Catalysts
He also noted that Nvidia’s issues in China, where it is awaiting regulatory approval to resume sales after months of a logjam, are both headline risk and a potential upside lever. Nvidia CEO Jensen Huang has emphasized that the Chinese market represents a $50 billion revenue opportunity, and Munster argues that if those sales materialize this year, they could lift 2026 revenue growth to more than 70%.
Beyond chatbots, Munster highlights "Physical AI" (robotics, autonomous systems, and computer vision) as a major future revenue driver. He predicts this segment could grow from $3 billion today to a $50 billion+ annual business by 2030, representing roughly 8% of Nvidia's projected revenue.
Stock Move, Q4 Estimates
Nvidia shears has traded in a narrow range over the past two months, suggesting a lack of consensus among investors on its future course. The stock closed 1% higher on Friday, taking its year-to-date gains to 1.8%. That’s still higher than the 0.9% gains in the benchmark S&P 500 index.
Nvidia's stock rose 62% to $57 billion in the third quarter (reported on Nov. 19), with data center segment sales doubling to cross the $50 billion mark for the first time.
For Q4, analysts expect revenue to rise 67% to $65.7 billion and adjusted profit to rise 71% to $1.53 per share, according to Koyfin.
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