Tech Giant Nvidia Set to Unveil Quarterly Results Amid High Expectations
As the curtain closes on tech earnings season, all eyes are on Nvidia, the world’s hottest company, as it prepares to reveal its latest quarterly results. With Wall Street predicting an 84% year-over-year revenue increase to $33.2 billion, the real focus is on the chip giant’s forecast for the final quarter of the year.
A New Era of Innovation
Nvidia’s next-generation GPU offering, Blackwell, is slated to start impacting the bottom line, and CEO Jensen Huang has touted “insane” demand for the new platform. This represents a significant leap in performance from the Hopper chips that fueled the AI boom. The company’s shares have skyrocketed over 800% in the last two years, adding more than $3 trillion in market capitalization and trading places with Apple as the world’s largest company.
Analysts Weigh In
Wedbush Securities’ Dan Ives, a prominent tech bull, anticipates another blowout release, predicting a $2 billion revenue beat and a similar raise to Q4 guidance. Others, however, are sounding a more cautious note, warning that Wednesday’s call could prove to be a “sell the news” event, similar to what happened last quarter.
Profit-Taking Ahead?
Ted Mortonson, a managing director at Baird, believes the stage is set for another round of immense profit-taking. With the stock nearly tripling year to date, institutions are likely driven by the fear of getting killed, rather than the fear of missing out. Retail investors, on the other hand, may be in for a surprise.
Blackwell: A Game-Changer
Jensen Huang previously stated that Blackwell should account for “several billions” of additional revenue starting in Q4. However, Angelo Zino, a vice president at CFRA Research, believes Wednesday’s forecast will be relatively conservative due to production delays and the complexity of the platform’s rollout.
A Platform Like No Other
Nvidia is marketing Blackwell as a customizable platform offering, rather than simply selling stand-alone chips. This means there are many more moving parts on Nvidia’s end, and the delivery of some systems may be pushed to 2025. As a result, the company may provide a buffer in its guidance, setting up potential massive earnings beats early next year.
A High-Stakes Game
By Nvidia’s lofty standards, Wednesday’s results and forecast could be a bit pedestrian. If that happens, big investors could be quick to sell, leaving retail traders in a precarious position. As Mortonson puts it, “It’s a casino stock, so good luck to them.”
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