Nvidia Gets a Price Target Cut From Citi as Competition in AI Arena Grows

Nvidia’s commanding lead in the artificial intelligence chip market may be narrowing as rivals ramp up efforts, according to Citi.

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Analyst Atif Malik reiterated his buy rating on Nvidia but lowered his price target by $10 to $210 per share. Even with the adjustment, Malik’s outlook still implies nearly 20% upside from Friday’s close, with Nvidia stock already up more than 24% this year.

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The revised price target follows Broadcom’s strong quarterly performance last week, which showed robust year-over-year growth. Broadcom also revealed a massive $10 billion order for its custom AI chips, known as XPUs, placed by a fourth yet-to-be-named customer.

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Malik now anticipates Nvidia’s 2026 GPU sales could come in about 4% below earlier forecasts. He pointed to intensifying competition from Broadcom, which is being bolstered by Google’s tensor processing units (TPUs) a product line that increasingly challenges Nvidia’s graphics processing units in AI computing.

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“We had already expected XPU sales to surpass GPU sales in 2026,” Malik wrote in a note to clients on Monday. “Broadcom’s comments about faster XPU adoption, likely driven by Google’s pivot toward indirectly competing with Nvidia by offering compute capacity to peers like Meta, OpenAI, and Oracle, reinforces a risk we flagged recently.”

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Malik estimates Nvidia could lose as much as $12 billion in GPU sales in 2026 as a result of these competitive dynamics.

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The next major event for Nvidia is CEO Jensen Huang’s keynote at the GTC conference on Oct. 28. Investors will be closely watching for product announcements and strategic updates that could address concerns about the company’s positioning in the AI race.

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In the meantime, Nvidia shares have dropped roughly 8.6% over the past month, reflecting investor unease after the company’s second-quarter data center revenue came in slightly below expectations. Another concern weighing on sentiment: Nvidia’s revenue is heavily concentrated, with its top two customers accounting for 39% of sales in the July quarter.

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Despite trimming near-term forecasts, Malik remains optimistic about Nvidia’s longer-term growth potential. His estimates for calendar years 2025 and 2026 are still slightly above Wall Street consensus, supported by expanding demand from “neoclouds” and sovereign AI projects.

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Neoclouds refer to emerging cloud providers driving fresh spending, while sovereign AI reflects deals with governments seeking to build and control their own AI infrastructure. Malik added that his projections do not include China, where resumed GPU shipments could represent a meaningful source of upside.

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Citi’s latest note underscores the challenges Nvidia faces as competition in the AI hardware market accelerates. Broadcom’s push into custom chips and Google’s advancing TPU technology could erode Nvidia’s market share faster than expected.

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Still, Nvidia continues to hold a strong position, with long-term drivers like sovereign AI and new cloud demand offering significant growth opportunities. Investors will be looking to Huang’s October keynote for clarity on how the company plans to defend its moat in an increasingly crowded field.

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