Investing.com -- Citi has trimmed its earnings and sales forecasts for both Nvidia (NASDAQ:NVDA) and Marvell Technology (NASDAQ:MRVL), pointing to lower cloud capital expenditure (capex) expectations and persistent macro uncertainty stemming from trade tensions.
For Nvidia, Citi lowered its calendar year 2025 (CY25) and 2026 GPU unit forecasts by 3% and 5%, respectively, as hyperscaler capex growth projections were revised to +35% and +15%.
The move reflects “mostly lower Microsoft (NASDAQ:MSFT) capex concerns and higher risk of pause in enterprise investments amid uncertainty around the global economy due to ongoing trade war.”
As a result, Nvidia’s earnings per share (EPS) estimates were reduced by 3% in CY25 and 6% in CY26, while the price target was cut to $150 from $163.
Still, Citi noted that Nvidia’s strong market position and pricing power may help mitigate some of the margin impact.
“Given its technology leadership and AI GPU price in-elasticity,” the company is expected to “partially pass down the increased GPU cost that may emanate from the trade war,” analyst Atif Malik said.
Marvell was also affected by the same macro overhang, particularly concerns over Microsoft’s capital spending and broader AI demand.
Citi slashed its fiscal year 2027 (FY27) revenue and EPS estimates for Marvell by 5% and 8%, respectively. The bank specifically cited a 20% cut to AI ASIC expectations and lowered forecasts for AI optics sales tied to Nvidia GPU volume adjustments.
Marvell’s target price was reduced sharply to $96 from $122.
“Our AI ASIC cuts reflect our concerns that C2026 trainium volumes may be below our prior expectations as the company may not be the only ASIC provider for the future trainium products,” Malik wrote.
However, for Marvell, the analyst points out that the stock has returned to its pre-custom ASIC rally levels and is now trading at a price-to-earnings (P/E) ratio of 13x, suggesting the bad news “is largely priced in.”
Both companies remain on Citi’s Buy list due to a more bullish longer-term outlook.
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