Nvidia’s Earnings Report: A Key Indicator for Investors
In recent weeks, investors have eagerly anticipated third-quarter earnings from various companies. Events like the upcoming election and advancements in artificial intelligence (AI) have made this earnings season particularly uncertain.
For the most part, the reports from major tech firms have been solid. However, one company that has captured widespread interest is Nvidia (NASDAQ: NVDA), which is set to release its earnings on Nov. 20.
Investors will want to pay close attention to this report, as it could carry significant implications. Here are critical elements to watch for, along with thoughts on whether now is the right time to buy Nvidia shares.
The Significance of This Earnings Report
In recent years, Wall Street analysts and Nvidia followers have focused heavily on the growth of the company’s compute and networking divisions. Sales from Nvidia’s data center services and graphics processing units (GPUs) have become major talking points.
The upcoming earnings report is expected to continue this trend. When CEO Jensen Huang and CFO Colette Kress speak to investors, they will likely face numerous questions about the upcoming Blackwell chip line—Nvidia’s most advanced GPUs to date.
Preliminary forecasts suggest that Blackwell could bring in $10 billion in revenue by year-end, but there’s another aspect that investors should monitor closely.
Nvidia’s relationship with Super Micro Computer, an important IT infrastructure partner, has faced challenges. Supermicro, known for providing storage architecture for Nvidia’s GPUs, recently delayed its annual report and lost its auditor.
As a result, Nvidia may be shifting some of its supply chain operations away from Supermicro towards other IT architecture firms. It will be essential to determine if this transition impacts Nvidia’s revenue guidance for Blackwell during the upcoming report.
Image Source: Getty Images.
Nvidia’s Stock Trends Around Earnings Reports
The graph below illustrates Nvidia’s stock performance over the past two years, including key dates for its quarterly earnings reports.
NVDA data by YCharts.
Historically, Nvidia’s share price exhibits increased volatility and momentum around earnings announcements. Insights regarding Supermicro and Blackwell may lead to significant movements in the stock price.
A Long-Term Perspective is Critical
In the broader context, Nvidia’s stock has seen substantial growth over recent years, consistently demonstrating resilience even after market fluctuations.
While the impressive gains make Nvidia’s stock appealing, investors must acknowledge the rising competition in the GPU sector. Although this may not be disastrous for Nvidia, newer chips from competitors could hinder its growth in the future.
Listening closely to Nvidia’s leadership regarding Blackwell will be crucial for investors to assess how these new GPUs might perform amid increasing competition. For now, buying Nvidia shares ahead of the earnings report appears to be a riskier gamble—better suited for short-term traders than long-term investors.
Thus, remaining on the sidelines with Nvidia may be the wiser choice, allowing investors to gather more information before making a move.
Is Now the Right Time to Invest $1,000 in Nvidia?
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Adam Spatacco has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
