NVIDIA Corporation (NASDAQ: NVDA) is having a horrible start to the trading session in the pre-market hours this morning, and for good reason. The company reported its earnings, missing the mark. Moreover, guidance was nothing to be happy about. Today, we’ll talk about the earnings report, what we’re seeing from NVDA as a result, and what we’ll be watching for ahead.
NVDA Reports Earnings
As mentioned above, NVIDIA Corporation is having a rough start to the trading session this morning. The company reported earnings, missing the mark and setting the stage for more upset ahead. Here’s what we saw from the report:
- Earnings Per Share – In terms of earnings per share, NVDA missed the mark. During the quarter, analysts expected that adjusted earnings would come in at $1.93 per share. However, the company actually reported adjusted earnings at just $1.84 per share. Although, it is worth mentioning that the company did beat expectations with regard to unadjusted earnings. On an unadjusted bases, analysts expected for earnings to come in at $1.71 per share. However, the company actually reported unadjusted earnings of $1.97 per share.
- Revenue – Revenu also proved to miss the mark. During the quarter, analysts expected that the company would generate revenue in the amount of $3.24 billion. Unfortunately, the company only reported revenue in the amount of $3.18 billion.
- Guidance – For the final nail in the coffin, we have guidance. The company said that it is expecting for fourth-quarter revenue to come in between $2.65 and $2.75 billion. Unfortunately, that figure is far lower than the $3.4 billion that analysts are expecting to see.
On a positive note, NVDA did increase its quarterly dividend. The dividend is now 7% higher at $0.16 per share. In a statement, Jensen Huang, CEO at NVDA, had the following to offer:
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.
Our near-term results reflect excess channel inventory post the crypto-currency boom, which will be corrected. Our market position and growth opportunities are stronger than ever. During the quarter, we launched new platforms to extend our architecture into new growth markets – RAPIDS for machine learning, RTX Server for film rendering, and the T4 Cloud GPU for hyperscale and cloud.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. In the case of NVIDIA, the news proved to be overwhelmingly negative. The company missed expectations on nearly every turn. At the same time, guidance was anything but positive. So, it comes as no surprise to see that the stock is tumbling in the market this morning. As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (8:30), NVDA is trading at $166.15 per share after a loss of $36.24 per share or 17.91% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the iWatch Markets team will continue to keep a close eye on NVDA. In particualr, we’re interested in following the story surrounding the company’s work to recover from this slump. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!