Gotrade News - Semiconductor stocks pushed to fresh highs after Nvidia delivered record fiscal Q1 2027 revenue of $81.6 billion. ON Semiconductor also rallied to $124.81, extending its year-to-date gain to 114% on AI data center demand.
The dual moves reinforce a narrative that AI infrastructure spending remains the dominant theme for US equities. Investors are now rotating into chip names tied to data center buildouts and electric vehicle silicon.
Key Takeaways
- Nvidia reported $81.6 billion in Q1 revenue, up 85% year-over-year, with data center sales climbing 92%.
- ON Semiconductor trades at 37 times 2026 earnings and projects 25 to 30% revenue growth through factory utilization gains.
- Nvidia's upcoming Vera Rubin platform promises 90% lower inference costs and 75% fewer GPUs versus Blackwell.
Nvidia Sets New Benchmark for AI Demand
According to The Motley Fool, Nvidia (NVDA) guided $91 billion for fiscal Q2 2027. That implies 95% year-over-year growth, accelerating from the prior 73 to 75% range and signaling no near-term demand peak.
CEO Jensen Huang told investors that the upcoming Vera Rubin platform will exceed Blackwell as the company's most commercially successful product. Every frontier model company has committed to adopting the architecture from its launch date in the second half of 2026.
The technical leap matters because Vera Rubin systems promise to cut inference token costs by 90% versus Blackwell. They also require 75% fewer GPUs to handle the same workload, reshaping the economics of running large language models at scale.
Despite the rally, Nvidia trades at a trailing price-to-earnings ratio of 33, roughly half its 10-year average of 61.7. The main near-term risk comes from AI service pricing pressure flagged by customers including Anthropic and Microsoft.
ON Semiconductor Bets on EV and Data Center Silicon
As reported by The Motley Fool, ON Semiconductor (ON) expects its AI data center revenue to double year-over-year in 2026. Management is targeting 9.4% annual revenue growth and 27% annual EPS growth over the next five years.
The company holds roughly 55% silicon carbide market share among new electric vehicle models debuting at the 2026 Beijing Auto Show. That position gives ON exposure to EV power chips, renewable energy storage, factory automation, and AI data center silicon simultaneously.
Manufacturing utilization reached 77% in the first quarter, with management targeting the low-90% range. Hitting that target through 25 to 30% revenue growth should expand margins materially without requiring large new capital spending.
Broader sentiment across chip peers stayed firm, with Broadcom (AVGO) and other AI-adjacent suppliers tracking the move higher. The combination of accelerating demand and improving capacity efficiency keeps the semiconductor sector at the center of US equity flows.
