Nvidia set to report fourth-quarter earnings after the bell
On December 6th, 2023, the CEO of NVIDIA, Jensen Huang, participated in a meeting with members of the media in Singapore.
Edgar Su, a renowned photographer who works for Reuters, captured a stunning image that juxtaposes the modern Singapore skyline with the traditional Chinese temple in the foreground. The photo was taken during the Chinese New Year festivities and conveys the co-existence of the old and the new in this cosmopolitan city-state. Edgar Su is a well-known photographer who is employed by Reuters. He managed to take a breathtaking snapshot of Singapore's contemporary skyline contrasting the backdrop of an ancient Chinese temple. The photograph was captured on the occasion of the Chinese New Year celebrations and effectively represents how the old and the new coexist harmoniously in this bustling and modern state.
On Wednesday, Nvidia is set to release their fourth-quarter fiscal earnings report which is creating a lot of buzz as it will give investors an idea of how much longer the artificial intelligence trend will continue to last.
This is what LSEG, once known as Refinitiv, believes Wall Street is anticipating based on their agreed upon estimates:
Nvidia has gained the most from the technology industry's current fixation on big artificial intelligence models that are created on the corporation's expensive server graphics processors.
From the conclusion of 2022 till now, the value of Nvidia stock has risen by almost five times, and this has caused the market worth of the company to reach $1.72 trillion. This has also caused the company to temporarily surpass Amazon and Alphabet, which are famous tech companies.
Nvidia is under pressure to surpass high expectations fueled by investors' interest in AI businesses.
Experts predict that Nvidia will experience a significant increase in revenue of approximately 240% from the same period last year, with a total amount of $20.6 billion. This surge in revenue is largely due to the success of their data center division, which sells specialized Artificial Intelligence GPUs, such as the H100. Analysts estimate that this sector alone will generate $17.06 billion in revenue. Additionally, the company's net income is anticipated to multiply more than seven times to reach a staggering $10.5 billion in the first quarter of this year.
The investors are keen to learn from Jensen Huang, the CEO of Nvidia, regarding the sustainability of its sky-high growth rates. There is a worry that the company sells many of its graphics processing units (GPUs) to major tech giants like Amazon, Google, Meta, and Microsoft.
Several businesses have announced their profits in the last few weeks and indicated that they will keep spending on fresh GPUs for the time being. However, there are a few experts that feel the outlook for demand in the long run could be a bit uncertain.
According to D.A. Davidson analyst Gil Luria's recent note to investors, the company used the terms 'flexible' and 'demand driven' to describe their purchases and suggested that they would decrease their buying if the current trend loses its popularity. Although there's no clear indication of it right now, we may be observing signs of that happening.
In four years, Nvidia intends to release a first-rate server GPU named the B100. The company's progress could be influenced by the debut time of this particular chip.
According to experts on Wall Street, sales will likely increase by a whopping 208% and reach a total of approximately $22.17 billion for this quarter.
Nvidia engages in multiple ventures, including creating chips for gaming on personal computers and developing automotive chips. Nonetheless, during the upcoming Wednesday, the primary spotlight will be on the company's GPUs that specialize in artificial intelligence, as these account for over 80% of Nvidia's revenue.
Barclays analyst Thomas O'Malley stated in a recent memo that the most important factor to consider, alongside the overall market trends, will be the [data center] GPU count.
