UBS Reports Taiwan’s Booming Exports Project NVIDIA’s Data Center Revenue at $42 Billion for April Quarter

This content is not intended as investment advice. The author does not hold any positions in the stocks mentioned.

NVIDIA at the Crossroads of US-China Trade Tensions

The ongoing global trade conflict, particularly between the United States and China, has intensified, evolving into a series of retaliatory tariff strategies. In this complex landscape, NVIDIA has emerged as a crucial player, facing both unique opportunities and significant challenges that come with its strategic prominence.

Recent Developments in NVIDIA’s Operations

An indication of NVIDIA’s strengthening market position was evident when the company secured an exemption from the Trump administration, allowing it to continue supplying critical AI components, specifically the H20 GPUs, to China without restrictions.

Implications of Taiwan’s Export Surge

In a recent analysis, UBS highlighted the substantial increase in Taiwan’s exports, which likely benefited from strategic moves related to tariffs. This analysis aims to project the positive outlook for NVIDIA’s data center sales in the quarter ending in April.

According to UBS analyst Timothy Arcuri, Taiwan’s exports of Automatic Data Processing (ADP) equipment—excluding laptops—totaled $12.03 billion for March 2025, showcasing a remarkable month-over-month growth of 20.6% when compared to February’s figures of $9.97 billion.

Historical Context and Future Projections

March is traditionally Taiwan’s strongest month for exports, often achieving mid-20 percent growth compared to February. While the figures this March were slightly below expected historical averages, it’s noteworthy that February saw a significant increase, marking the strongest performance in over a decade with a 14% rise month-over-month, surpassing the historical average decline of 15%.

“Assuming April constitutes a ‘normal’ 36% of total F1Q (Apr Q) would imply ~$34B of exports – a large step-up of ~58% Q/Q – although it is unclear to what extent this reflects tariff pull-ins rather than underlying strength.”

NVIDIA’s Expected Growth in Data Center Revenue

If Taiwan maintains its historical export patterns, there could be a potential 58% increase in quarter-over-quarter exports, which would correspondingly predict an 18% growth in NVIDIA’s data center revenues.

“We model NVDA’s data center revenue up 18% Q/Q to $42B in Apr Q.”

Market Adjustments and Strategic Insights

While UBS acknowledges past discrepancies between Taiwan’s export data and NVIDIA’s sales performance, the market outlook remains optimistic, especially in light of TSMC’s recent reporting of above-seasonal sales for March 2025.

Conversely, Citi has downgraded its total GPU sales forecast for NVIDIA by 3% for the current calendar year and 5% for the following year, attributing this decrease to concerns over reduced capital expenditures from Microsoft and hesitance in enterprise investment amidst ongoing economic uncertainties resulting from the trade conflict.

In contrast, Lynx Equity posits that NVIDIA has effectively implemented a comprehensive strategy to mitigate the impact of US tariffs, primarily by sourcing components from outside the United States, with assembly conducted by Taiwan-based system integrators. This strategic approach minimizes the company’s exposure to potential tariffs, and Lynx asserts that it is unlikely for China to impose punitive tariffs on NVIDIA due to the latter’s essential role in China’s tech ecosystem.

With these considerations in mind, Lynx Equity anticipates that NVIDIA will soon return to its historical highs.

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