Goldman Sachs expects demand for AI to remain strong and ensure another successful quarter.

Goldman analysts led by Toshiya Hari expect Nvidia’s revenue and earnings per share to beat estimates as the company’s fundamentals allow for further upside.

Strength will come from revenue from the data center business and the company’s strong operating leverage, Goldman said. At the same time, the bank cited that Nvidia’s hardware remains in demand among leading cloud service computers and the company maintains its competitive edge in the AI ​​computing sector.

For investors concerned that AI spending has not yet produced meaningful results, Nvidia’s earnings should counteract that narrative, Goldman said.

“We expect Nvidia management to provide ROI metrics from select customers at the upcoming earnings call to help build investor confidence,” Hari wrote.

However, given the delay in the Blackwell chip, investors should expect some immediate volatility, Hari wrote.

However, this will only be a short-term headwind, and Nvidia has no shortage of solutions. The impact will depend on three factors: the extent of the delay, whether customers are willing to adopt the older Hopper chip, and Nvidia’s ability to ramp up production of a simplified Blackwell model.

Goldman recommends Nvidia as a “buy” and has a price target of $135 per share.