Santa Clara, California – Nvidia is gearing up to release its first-quarter earnings after the closing bell on Wednesday, marking a crucial report for investors this year. The tech giant is expected to announce significant increases in revenue and profits, driven by a surge in demand for its chips amid the AI boom.
Analysts are forecasting that Nvidia will report adjusted earnings per share of $5.65 on revenue of $24.69 billion, representing substantial growth compared to the prior-year period. The company’s stock has been on a steady rise, gaining over 200% in the past year and nearly 700% since the market lows in October 2022.
Nvidia’s Data Center business is projected to lead the way in revenue, with expectations set at $21 billion, a notable increase from $4.28 billion in the first quarter of the previous year. The Gaming division, once Nvidia’s largest segment, is also anticipated to see growth, with revenue expected to reach $3.5 billion, up from $2.24 billion in the same quarter last year.
Stifel analyst Ruben Roy raised his price target on Nvidia’s shares, expressing confidence in the company’s ability to surpass expectations and provide positive guidance for the next quarter. The demand for Nvidia’s chips from major companies like Amazon, Google, Meta, Microsoft, and others has played a significant role in driving the company’s results.
Despite the positive outlook, concerns linger about the transition from Nvidia’s current Hopper line of AI chips to its upcoming Blackwell line. There are fears that customers may delay orders for Hopper chips in anticipation of the more powerful Blackwell products, potentially impacting Nvidia’s sales in the short term.
Furthermore, Nvidia faces competition from customers developing their own in-house AI chips, with companies like Amazon, Google, and Microsoft working on or already utilizing their own solutions. While this shift may affect Nvidia’s market share, the company continues to innovate and collaborate with industry leaders to stay competitive in the rapidly evolving AI landscape.
As Nvidia prepares to unveil its earnings report, all eyes will be on the company’s performance and guidance, offering valuable insights into the ongoing AI revolution and its impact on the tech industry as a whole.