Nvidia CEO Jensen Huang said the company could sell twice as many chips next year on the strength of its new Vera Rubin system. Nvidia shares ticked higher Monday as AMD surged on an unconfirmed report of a 10% AI chip price increase.
Vera Rubin could double chip sales next year
Nvidia has started shipping its next-generation data center system, Vera Rubin, which can deliver up to 30 times more performance than the equivalent Blackwell Ultra system while cutting inference token costs by a staggering 97%. Speaking in Scotland last week, Huang said Nvidia could sell twice as many chips next year compared to this year.
The chipmaker doesn't disclose unit sales, but it's on track for around $411 billion in total revenue during its current 2027 fiscal year, based on Wall Street's average estimate. Management has told shareholders to expect 70% revenue growth in fiscal 2028, which would put next year's total near $700 billion.
Nvidia trades below its own historical valuation
Despite the growth outlook, Nvidia's valuation has room to run: the stock trades at a price-to-earnings ratio of 28.1, less than half its 10-year average of 61.4. It also sits at just 14 times Wall Street's average fiscal 2028 earnings estimate.
Risks remain, however. The top five hyperscalers are on track to spend a combined $800 billion on infrastructure this year, a figure Nvidia believes will grow to $1.3 trillion next year. CFO Colette Kress has also said around 25% of the company's fiscal 2028 sales will come from customers Nvidia itself has financed.
AMD's price-hike report lifts the chip sector
Nvidia shares also moved Monday as a supply-chain report lifted the broader chip sector. AMD stock rose 5% to $586.66 after the report indicated AMD notified partners of a 10% price increase planned for the fourth quarter, tied to higher wafer costs at its foundry partner. AMD hasn't confirmed the account, and both its scope and timing remain unverified.
The chipmaker's stock traded at $223.72, up 0.7%, tracking the AMD-led rally without a pricing catalyst of its own. Taiwan Semiconductor, AMD's foundry supplier and the origin of the reported wafer-cost increase, rose 1% to $440.92.
Sources: Motley Fool (via Yahoo Finance), 24/7 Wall St. (via Yahoo Finance)
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