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SLT Core Portfolio: Nvidia ($NVDA) Earnings Update
NVDA reported its first-quarter earnings for fiscal year 2024, surpassing expectations and causing a 27% surge in shares during extended trading.
The company's adjusted EPS was $1.09 compared to the expected $0.92, and its revenue reached $7.19bn, exceeding the estimated $6.52bn. NVDA mainly provided a strong outlook for the current quarter, predicting sales of approximately $11bn, more than 50% higher than the Wall Street estimate of $7.15bn.
The company's data-center group performed well, with $4.28bn in sales, driven by demand for its GPU chips from cloud vendors and consumer internet companies. However, the gaming division experienced a 38% revenue decline due to a slower macroeconomic environment and the introduction of new gaming GPUs. The company's automotive division, focused on self-driving cars, grew by 114% YoY, but sales remained relatively small at under $300mn for the quarter.
Overall, net income for the quarter was $2.04bn, a 26% increase compared to the previous year, while the company's sales decreased by 13% to $8.29bn.
I’m amazed— I had thought Wall Street was already pricing in a lot of the good news. Their guidance was huge.
The question investors and over-market participants have to ask is - How long does this go on? The propensity to think that just because it keeps going up means it will indeed HAVE to come down, but if they truly are providing a majority of hardware for the next technological paradigm, which has been speculated to be larger than the internet, then apart from some minor pullbacks this name may be one we look back at in the future and utter the cliche words "That was obvious".
Disclosure - I'm long $NVDA
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