AFP
Nvidia is poised to announce a remarkable surge in its second-quarter earnings, with revenue expected to more than double, potentially reaching $28.68 billion. This growth is fueled by the high demand for Nvidia’s AI chips, crucial for advanced computing infrastructure. The company’s stock has soared by over 150% this year, adding a massive $1.82 trillion to its market value and boosting the S&P 500 index, according to Reuters.
Despite these impressive results, investors are cautious. Any slight miss in meeting these high expectations could impact Nvidia’s stock negatively, currently valued at about 37 times its forward earnings—significantly higher than other top tech firms.
Looking forward, Nvidia is facing challenges. Reports suggest possible delays in the production of its next-generation Blackwell AI chips, potentially slowing revenue growth in the coming year due to design issues. Moreover, if chip manufacturer TSMC raises production costs, Nvidia’s profit margins could be affected, as hinted by the Taiwanese company.
In the Chinese market, Nvidia is encountering obstacles due to U.S. government restrictions preventing the direct sale of its most advanced AI chips in China. However, Chinese AI developers are reportedly finding ways to access Nvidia’s powerful H100 chips through overseas brokers, despite efforts to conceal their identities. This workaround was detailed in a report by The Wall Street Journal.
Despite these challenges, Nvidia is projected to announce robust third-quarter revenue of $31.69 billion, although the growth rate is expected to slow compared to previous quarters.
2024-09-02 09:15:02
Link from www.ibtimes.com