“The functionality of Blackwell is as it is and we expect to start shipping in the fourth quarter,” he said, adding that demand for Nvidia’s Hopper chips has been “really strong” and that demand for Blackwell has been “incredible.”

Blackwell revenue growth

Chief Financial Officer Colette Kress said Blackwell should generate “several billions” in revenue for Nvidia’s fiscal fourth quarter, which ends in January. She said Hopper sales would accelerate in the second half of the year.

That proved important to investors, who worried that Blackwell’s launch would lead to cancellations or delays of Hopper orders as customers waited for the new, more powerful processors and systems to hit the market.

Related: Nvidia Earnings Beat Forecast, But Blackwell Delay Signal Hits Stocks

However, the Blackwell increase is likely to negatively impact Nvidia’s profit margins, which fell slightly to 75.7% in the second quarter and are likely to approach 75% in the near term.

“Despite a lower-than-expected gross margin outlook, Nvidia’s revenue opportunities in data center for cloud, consumer internet and enterprise customers remain strong,” said Goldman Sachs analyst Toshiya Hari, who reiterated his buy rating and $135 price target on Nvidia shares following last night’s earnings update.

The story continues

“With a new design of the Blackwell GPU, management expects multi-billion dollar revenue in the fourth quarter of fiscal 2014, supported by growing Hopper revenue,” he added.

Blackwell Proposes a ‘Nothing Burger’

JPMorgan analyst Harlan Sur had a similar view, noting that the two-month delay in Blackwell GPU shipments should not impact Nvidia’s overall revenue profile as it is “offset by strong Hopper performance.”

“We expect gross margins to improve next year as Nvidia maintains a strong lead over competitors with its aggressive product launch cadence,” said Hur, who added $40 to his price target for Nvidia, taking it to $155 per share.

Related: Nvidia Stock Price Tied to 5 Key Items in Q2 Earnings Report

Cantor Fitzgerald analyst CJ Muse, who reiterated his $175 price target and overweight rating on Nvidia shares, said concerns about Blackwell’s delay “do not appear to be an issue ahead of one of the biggest and worst product cycles in Nvidia’s history.”

“We see no change in the AI ​​story underlying Nvidia and believe today’s potential pullback is simply another buying opportunity,” he added.

Piper Sandler analyst Harsh Kumar shared that view, sticking to his $140 price target and overweight rating following last night’s earnings update.

“The company is well positioned to capitalize on strong AI demand with Hopper and Blackwell,” Kumar said. “Gross margins are expected to stabilize, supporting continued growth.”

Nvidia expectations remain high

Bernstein SocGen Group analyst Stacy Rasgon, who raised his price target on Nvidia by $25 to $150 per share, said the group “continues to deliver against high expectations, with strong data center growth and multi-billion dollar revenue forecast at Blackwell in the fourth quarter.”

“Demand for Hoppers remains strong and we expect significant growth next year, driven by a diversified customer base and increasing AI capabilities,” he added.

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Edward Jones analyst Logan Purk took a more conservative view, reiterating his hold rating on Nvidia. He said that while the group “remains the leader in high-performance GPUs and has a 90% market share in data center accelerator chips,” management will be challenged to consistently exceed expectations.

“We believe the stock reflects our optimistic growth outlook and is valued appropriately,” Purk said.

Shares of Nvidia fell 3.15% in pre-market trading, with more than 9.8 million shares changing hands. The opening price was $121.65 each.

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