NVIDIA (NVDA) Q3 earnings results outperformed part of the markets forecasts
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Summary:
- Revenue surpassed analysts' projections, earnings per share lagged behind.
- Nivida’s Q4 revenue estimates fell short of investor expectations.
NVIDIA Q3 earnings
The industry leader in graphics chips, Nvidia (NVDA), released its Q3 earnings results after the market closed on Wednesday. While revenue surpassed analysts' projections, earnings per share lagged behind. According to data provided by Bloomberg, the company outperformed Wall Street forecasts in the following areas: revenue ($5.93 billion vs. $5.79 billion projected). EPS after adjustments: $0.58 vs. $0.70 anticipated. Gaming income was $1.57 billion as opposed to the predicted $1.32 billion. Revenue from data centers: $3.83 billion versus $3.7 billion anticipated.
With a $6 billion forecast, Nvidia's Q4 sales fell just shy of Wall Street estimates. Analysts anticipated $6.09 billion. Shares of Nvidia increased by about 2% after the revelation. In the quarter, income from data centers increased by about 31% year over year, but revenue from gaming fell by 51%. As consumer and commercial demand for electronics has decreased following the enormous rise the sector experienced during the epidemic, chip stocks have taken a beating this year. After stocking up during shutdowns, consumers don't need as many computers, and businesses already have plenty of equipment for their remote and hybrid workers.
The future of NVIDIA
Nvidia reduced chip manufacturing in Q2 while CEO Jensen Huang informed investors that the business was attempting to better match inventory to chip demand. During the pandemic, Nvidia's graphics chips were in such great demand that they were fetching hundreds of dollars more than their retail costs. However, as people resumed their pre-pandemic lifestyles, demand for chips decreased and prices returned to normal.
Nvidia is also making efforts to maintain its ability to sell its premium goods in China. As a substitute for the A100 chip, which the U.S. government claimed was too potent to be shipped to China, Nvidia started selling its new A800 processor there during Q3 of this year. The administration is concerned that China will employ the technology for military purposes.
NVDA Price Chart
Sources: finance.yahoo.com
