Why Nvidia Shares Suffered After Its Q3 Report
Nvidia released mixed quarterly results after the close on Thursday, and shares tumbled in Friday's premarket.
Nvidia Corp. (NASDAQ: NVDA) released its most recent quarterly results after the close on Thursday. While the third-quarter results were fairly impressive, there seemed to be more issues raised about Nvidia going forward with guidance.
The company said that it had $1.84 in earnings per share (EPS) and $3.18 billion in revenue, which compares with consensus estimates from Thomson Reuters that had called for $1.71 in EPS and $3.24 billion in revenue. The same period of last year reportedly had EPS of $1.33 on $2.64 billion in revenue.
Looking ahead to the fiscal fourth quarter, the company is calling for $2.70 billion in revenue, give or take 2%, with a gross margin of 62.5%. The consensus estimates are $1.81 in EPS and $3.4 billion in revenue for the quarter.
On the books, Nvidia’s cash, cash equivalents and notable securities totaled $7.59 billion, up from $7.11 billion in the same period last year.
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Jensen Huang, founder and CEO of Nvidia, commented:
AI is advancing at an incredible pace across the world, driving record revenues for our datacenter platforms. Our introduction of Turing GPUs is a giant leap for computer graphics and AI, bringing the magic of real-time ray tracing to games and the biggest generational performance improvements we have ever delivered.
Shares of Nvidia closed Thursday at $202.39, in a 52-week range of $176.01 to $292.76. The consensus analyst price target is $287.91. Following the announcement, the stock was down 18% at $166.02 in early trading indications Friday.
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Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics. Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications. A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.
