Deepwater’s Gene Munster, shared his views on Nvidia Corporation NVDA recent performance, suggesting it was solid but fell short of extraordinary expectations. However, he remains upbeat on the stock.
What Happened: In an interview with Bloomberg on Thursday, Munster stated, “Yeah, I would actually say it was great, but not extraordinary. And that’s really what this needs to be.” He further elaborated on the company’s margin guidance and the impact of tariffs on its future performance.
Munster further stated that the company raised guidance by $1 billion instead of a couple of billion, and margin guidance came in slightly lower than anticipated. Munster mentioned that when the company was asked if they could ramp up the margin amid the intense tariff situation in their conference call, their answer was ambiguous. The CFO stated ‘..it’s a little bit of an unknown until we understand what the U.S. government’s plan is.” This, Munster feels, could have dented investor confidence, leading to a decline in the stock in the after hours trading session on Wednesday.
He noted that Nvidia previously stated Blackwell chips would be sold out for “several quarters” in 2025, but this time there was no clarity over it, raising investor concerns.
Why It Matters: Despite these concerns, Munster remained optimistic about Nvidia’s long-term prospects. According to him, demand for advanced computing is at an all-time high, with new AI models requiring exponentially more processing power.
In his investor note, Munster stated, ” I believe Jensen (Jensen Huang) is on the right track in claiming that reasoning increasingly drives a 100x increase in demand for compute. If true, the company will return to reporting impressive upside in CY26.”
“Despite the emergence of cheaper alternatives to Nvidia GPUs including custom silicon, I believe they will remain the dominant workhorse for the next 3-5 years,” sums up Munster.
He believes the current dip presents a buying opportunity. “I think that this is a buy here on the pullback,” Munster told during the Bloomberg interview.
On the other hand, DA Davidson‘s tech analyst, Gil Luria, predicted a slowdown in growth for Nvidia. While the company’s fiscal year 2025 revenue more than doubled year-over-year to $130.5 billion, Luria suggested that this might be as good as it gets for Nvidia.
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