Nvidia (NVDA) is set to host its annual GTC confab next month, and GF Securities believes the widely watched event is likely to be a catalyst for the stock and the semiconductor industry itself.
Analysts at the firm said they expect some of the key highlights to be co-packaged optics, with expectations that Nvidia will launch its second-generation co-packaged optic switch. This is expected to feature Taiwan Semiconductor’s (TSM) co-packaged optic technology, but volume is not expected to ramp until 2027, when it hits 80,000, analysts at the firm said.
Another highlight is the potential announcement of a language processing unit rack that features SRAM-based on-chip memory. This will offer fast token generation and “ultra-low latency, enhancing Nvidia’s position in inferencing,” the analysts added.
Other potential announcements include updates on its Feynman line of GPUs, its Kyber NVL576 line of racks, and more.
The industry may need GTC to be a broad catalyst, as analysts at the firm said the recent correction in semiconductor stocks appears to be similar to the one it experienced in the second-quarter of 2024.
“Looking back to the major correction in past years, we believe the current one is similar to that of 2Q24, the time AI semi/NVDA shares pulled back on worries over slower rate cut, inference demand and impact from companies’ issue (i.e., SMCI, ASML), followed by a strong rally triggered by robust CSP capex guidance,” analysts at the firm explained. “For this time, due to similar concerns on liquidity, CSP/OpenAI’s cash flow amid a much large spending scale plus a worry on AI spending shift to memory, large cap AI semis such as NVDA, AMD, Broadcom, Hon Hai, etc. underperformed, despite the strength seen in TSMC, in past 3 months. Nevertheless, we remain bullish and, followed by the strong CSP capex raise (a similar pattern of 2Q24), we foresee catalysts such as an improved funding visibility of Oracle/xAI/OpenAI, the acceleration of multimodality & agent, and the upcoming events of NVDA earnings and GTC 2026.”