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Anticipating Nvidia’s Fiscal Q4 Earnings Report

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Nvidia (NVDA) is gearing up to announce its fiscal Q4 earnings, an event that will likely send ripples through the tech stock market. With a remarkable 40% surge this year, it leads as the top-performing stock in the S&P 500, following an astonishing +200% surge in 2023, propelling Nvidia to become the fourth largest global company, valued at $1.79 trillion. The company’s Q4 revenue is projected to more than triple for the second consecutive quarter, predominantly fueled by robust demand in its data center business, responsible for 80% of its sales.

Based on Nvidia’s projections, the company is expected to reveal a staggering $59 billion in revenue for the fiscal year ending in January, more than double the previous year’s figure. Comparative data from S&P Global Market Intelligence indicates that none of Nvidia’s peers, including tech giants like Apple, Alphabet, Amazon.com, and Microsoft, have experienced such rapid revenue growth from a similar starting point within a single year. If these projections hold, Nvidia is poised to surpass Intel, securing its position as the world’s second-largest chip company, based on annual revenue.

The AI Revolution and Nvidia’s Meteoric Rise

The meteoric rise in Nvidia can be largely attributed to the fervor surrounding artificial intelligence (AI), which has driven unprecedented growth in the company. Five years ago, Nvidia was primarily focused on the niche market of gaming PCs. However, its expanded presence in AI has propelled the company with a recent 25% surge, presenting a potential risk ahead of the imminent earnings report. Strikingly, the ongoing earnings season has been brutal for tech companies, with many witnessing steep declines following significant run-ups.

Challenges and Future Projections

Even if Nvidia exceeds expectations in its earnings report, the crucial question emerges: how sustainable is this boom? Analysts are closely eyeing AI chip demand for the upcoming year and beyond. Market projections anticipate Nvidia to forecast $21.6 billion in revenue for Q1, tripling the figure from the same period the previous year. Furthermore, analysts are anticipating Nvidia to forecast revenue just under $92 billion for the fiscal year ending in January 2025β€”a notable 56% surge from the just-concluded fiscal year.

The company’s introduction of new products will be pivotal in maintaining its dominance in the AI chip market. Notably, Nvidia is preparing for the launch of its highly anticipated AI system, the B100, later this year. According to Morgan Stanley, leaks about the B100 system suggest it represents β€œa strong advancement of state of the art”. Reflecting on this, Bank of America believes Nvidia will be in a position to price the B100 products at least 10% to 30% higher than its current H100 system, thereby ensuring a continuous flow in its revenue stream.

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On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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