NVIDIA Earnings Preview: Growth Already Priced In, Where Is the Next Catalyst?

Nvidia (NVDA.O) is set to release its financial results for the first quarter of the fiscal year, ending in April, following the close of Wall Street trading on Wednesday. Major Wall Street institutions widely anticipate that the company will once again exceed market expectations. However, there is a clear divergence among analysts regarding whether the stock price can move further upward given this scenario.

According to the forward-looking reports published by Goldman Sachs, Citibank, UBS, and Deutsche Bank this month, despite slight differences in forecast values, "exceeding expectations and raising guidance" is almost a consensus among all. The question is, when "exceeding expectations" has become the norm, how much strength is truly needed to drive the stock price?

Revenue forecasts are higher than the market consensus across the board

The first-quarter revenue forecasts from the four institutions are all around $80 billion, higher than the company's previously provided guidance mid-point of $78 billion, and also above the current market consensus of approximately $78.6 billion.

Goldman Sachs expects Nvidia to achieve an overperformance of about $2 billion in the first quarter, forecasting revenue to reach $80 billion, and positioning its second-quarter guidance higher than the market consensus by about 3%, predicting Q2 revenue to be $87.6 billion.

Citibank's forecast is more aggressive, expecting Q1 revenue to be around $80 billion, and believes that the accelerated volume of B300 chips will drive Q2 revenue to about $88.7 billion, exceeding the market consensus by about $1 billion and $200 million, respectively.

UBS holds an equally optimistic stance, estimating Q1 revenue to be about $80.6 billion, and raising its second-quarter guidance expectations to $90.3 billion, significantly higher than the market consensus of $86.9 billion at the time, mainly due to the synchronous acceleration of data center compute chips and networking business. Deutsche Bank's forecast is relatively conservative, with Q1 expectations around $79.7 billion and Q2 around $86.6 billion, generally close to the market consensus.

Trillion-dollar order visibility becomes the focus

All institutions regard Nvidia's "cumulative data center revenue not less than one trillion dollars from 2025 to 2027" order visibility revealed at the GTC 2026 conference as a core issue and look forward to the management providing more updates or raised information during this conference call.

Goldman Sachs clearly states that investors will focus on the potential upward adjustment space of this trillion-dollar guidance, as well as incremental revenue sources such as Rubin Ultra (2027 model), Vera standalone CPU racks, and Groq/LPX configurations for inference scenarios, which have not yet been included in this guidance.

UBS's model shows that, considering opportunities in CPU, CPX, and LPX, the company's revenue prospects for 2026 to 2027 will exceed this trillion-dollar benchmark, raising its 2026 revenue forecast to $400 billion, and further to $606.5 billion in 2027. Citibank estimates that Nvidia's Artificial Intelligence GPU sales will reach $284.8 billion in the fiscal year 2027, representing a year-over-year growth of about 79%.

Gross margin dispute is lower than expected, focus shifts to operating margin

The four institutions have reached a high consensus in their gross margin forecasts: they all predict around 75%, in line with the lower end of the company's guidance. This figure means that the previously worried risk of margin suppression has largely dissipated due to the higher efficiency of the Rubin chip's ramp-up compared to the previous Blackwell generational shift.

Deutsche Bank points out that as gross margin expectations have stabilized, investors will shift their focus to whether the operating margin can expand further on the current high level of about 65% to 67%, and whether management will provide a clearer statement on shareholder return policy – that is, the target of allocating 50% of free cash flow. UBS expects to maintain a 75% gross margin throughout the year and calculates the company's annual free cash flow to be about $190 billion, expanding to $320 billion by 2027.

The top four focus issues

Based on various institution reports, the four most market-focused issues in this earnings call are as follows:

• B300 accelerated volume and Rubin timeline: Institutions widely expect B300 to accelerate significantly in Q2, but UBS points out that Rubin rack-level cooling issues may delay mass production until September to October, relying