Nvidia Shares Drop Over 2% Monday, Pressuring Tech Sector

NVIDIA Corp. shares fell more than 2% on Monday, with weak technology stocks weighing on the chipmaker ahead of its earnings report due August 26.

The Nasdaq Composite fell 0.78%, the S&P 500 slipped 0.19%, and the tech sector declined 1.5%.

• Nvidia shares came under downward pressure. Why is NVDA stock falling?

Nvidia is entering the next phase of AI growth, with Blackwell Ultra shipments ramping up and Vera Rubin beginning initial production ramp, as the company expands across computing, networking, software, infrastructure, and financing.

Cantor Bullish on Nvidia Beyond GPU Business

Cantor Fitzgerald analyst C.J. Muse reiterated an Overweight rating on Nvidia with a $350 price target.

Muse believes investors are underestimating Nvidia's ability to sustain growth as it expands beyond GPUs into networking, rack-scale systems, software, infrastructure, and financing. While custom chips could pressure Nvidia's unit share at hyperscale data center operators, he expects the company's broader systems strategy to support more resilient revenue share.

Muse outlined a bullish scenario of $16 to $17 earnings per share for calendar 2027, and expectations of $23 to $25 for 2028. Cantor projects hyperscale data center operator capital expenditures to approach $1 trillion in 2026, potentially reaching $1.5 trillion in 2027.

He estimates Nvidia's calendar 2026 data center revenue could reach approximately $400 billion, representing roughly 80% of the $500 billion AI accelerator and networking market.

By 2030, Cantor's scenario models show data center revenue of approximately $1.05 trillion at 60% market share, $1.23 trillion at 70% share, and $1.4 trillion at 80% share. Muse views 60% share as a bear-case scenario, estimating Nvidia could still generate $25 to $30 in earnings per share by 2030.

JPMorgan Expects Another Beat-and-Raise

JPMorgan analyst Harlan Sur reiterated an Overweight rating with a $280 price target.

Sur expects fiscal second-quarter revenue of $94 billion to $95 billion, up approximately 15% quarter-over-quarter, exceeding the street consensus of $92.1 billion. He projects GB300 and remaining GB200 rack shipments to grow approximately 15% quarter-over-quarter to 17,000 to 18,000 units.

For the October quarter, Sur expects Nvidia to guide revenue of $107 billion to $108 billion, versus consensus of $104.5 billion.

He expects rack shipments to grow another 13% to 14% to 19,000 to 20,000 units, including the first 1,000 to 2,000 Vera Rubin racks. Sur estimates Vera Rubin could lift blended average selling prices by 5% to 10%, while reducing per-token platform costs by approximately 90% compared to Blackwell Ultra.

Sur also estimates that every 100,000 H200 GPUs shipped to China could add approximately $3 billion in revenue.

Competition and Gross Margin Remain Focus Areas

Sur expects that over the next few years, GPU and ASIC/XPU platforms will trend toward roughly equal share in the AI computing market, with Nvidia maintaining overall leadership.

He expects near-term gross margins in the mid-70s range but views rising memory costs as a longer-term risk. According to Sur, Nvidia trades at approximately 17 times street calendar 2027 earnings per share and 13 times 2028 earnings per share.

Earnings and Stock Performance

Nvidia will report earnings on August 26.

Wall Street expects earnings per share of $2.07, compared to $1.04 in the same period last year, on revenue of $92.03 billion, versus $46.74 billion a year ago.

NVDA Stock Performance

As of Monday's publication, Nvidia shares were down 2.14% at $210.13.