NextFin News - As the global technology sector braces for the next phase of the artificial intelligence revolution, financial analysts are increasingly bullish on Nvidia (NVDA), predicting a substantial stock rally following the company’s fourth-quarter earnings report scheduled for February 25, 2026. The anticipation centers on U.S. President Trump’s economic environment, where domestic chip manufacturing and AI leadership have become central pillars of national policy. According to TheStreet, the market is currently fixated on the transition from the record-breaking Hopper architecture to the new Blackwell platform, with investors seeking confirmation that the "hardware wave" is evolving into a sustainable, high-margin software and services ecosystem.
The upcoming earnings call is expected to address critical supply chain developments. Throughout 2025, Nvidia faced significant packaging bottlenecks, specifically regarding Taiwan Semiconductor Manufacturing Company’s (TSMC) CoWoS-L capacity. However, data indicates that Nvidia has successfully navigated these hurdles. As of early 2026, the company has reportedly secured over 50% of TSMC’s advanced packaging output, which is projected to reach 130,000 wafers per month by the end of the year. This aggressive procurement strategy suggests that the supply constraints which previously capped Nvidia’s upside are now largely resolved, allowing for a frictionless ramp-up of Blackwell shipments.
Beyond the immediate hardware cycle, the focus is shifting toward the Vera Rubin (R100) architecture. During the CES 2026 conference in January, CEO Jensen Huang confirmed that the Rubin platform remains on track for a late 2026 launch. This next-generation system, featuring HBM4 memory, is designed to power the "Agentic AI" era, offering a leap in power efficiency and inference throughput. Analysts, including those from Bank of America, suggest that providing a "clean" shipment schedule for Rubin will be the primary catalyst to dismantle bear theories regarding a potential "demand air pocket" in the semiconductor cycle.
The financial implications of this transition are profound. The shift from individual B200 GPUs, priced between $30,000 and $40,000, to integrated GB200 NVL72 racks represents a massive jump in Average Selling Price (ASP). These liquid-cooled rack systems can cost between $2 million and $3 million each. If CFO Colette Kress indicates that these rack-scale systems comprise a larger portion of the company’s backlog, it would signal a margin expansion that the broader market has yet to fully price in. Goldman Sachs reports that despite rising input costs for HBM memory, Nvidia expects to maintain gross margins in the mid-70% range through 2026, supported by premium pricing and operational efficiencies.
Perhaps the most significant long-term driver identified by analysts is the monetization of Nvidia Inference Microservices (NIMs) and "AI Blueprints." This represents Nvidia’s evolution from a hardware vendor to a software-defined platform provider. By charging approximately $4,500 per GPU per year for the NVIDIA AI Enterprise suite, the company is building a recurring revenue stream that de-risks the stock from the cyclicality of hardware sales. This "operating system" for autonomous agents allows Fortune 500 companies to move from experimental AI to production-grade digital workers, creating a competitive moat that rivals like AMD and Intel are struggling to replicate.
Furthermore, the rise of "Sovereign AI"—where nations invest in domestic AI infrastructure to ensure data security and technological autonomy—is opening a new frontier. McKinsey estimates this market could reach $600 billion by 2030. As U.S. President Trump emphasizes American technological dominance, Nvidia’s role as the primary provider for these national-level projects provides a high "earnings floor." Even if large-scale cloud service providers eventually moderate their spending, the demand from sovereign states and smaller specialized providers is expected to sustain growth. Consequently, the February 25 report is viewed not just as a look back at 2025, but as the definitive signal for Nvidia’s dominance in the 2026 fiscal year.
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