Earnings Preview: Nvidia, Will the decline continue following the previous quarter? Concerns about delayed deliveries to Blackwell again, what impact on performance?
This article utilizes auto-translation in some parts.
● $NVIDIA (NVDA.US)$After the market close on November 20th, Eastern Time in the United States.(Scheduled to announce earnings on November 21st, Thursday, from 06:00 Japan time)。
According to market consensus, $NVIDIA (NVDA.US)$The performance forecast for Q3 2025 is expected to have revenue of 33.028 billion dollars, an 82.27% increase compared to the same period last year. The EPS is expected to increase by 88.11% to 0.70 dollars compared to the same period last year.
● Wall Street collectively raises NVIDIA's target stock price.
● The company's stock price tripled compared to the end of 2023, driven by the tailwind of major tech companies' capital investments.
● Issues with the server rack design for next-generation chips? What impact will it have on performance?
According to market consensus, $NVIDIA (NVDA.US)$The performance forecast for Q3 2025 is expected to have revenue of 33.028 billion dollars, an 82.27% increase compared to the same period last year. The EPS is expected to increase by 88.11% to 0.70 dollars compared to the same period last year.
● Wall Street collectively raises NVIDIA's target stock price.
● The company's stock price tripled compared to the end of 2023, driven by the tailwind of major tech companies' capital investments.
● Issues with the server rack design for next-generation chips? What impact will it have on performance?
$NVIDIA (NVDA.US)$Earnings reports are scheduled to be announced after the close of November 20th US Eastern Time (06:00 on November 21st, Thursday in Japan time). According to market consensus, $NVIDIA (NVDA.US)$The performance forecast for Q3 2025 is expected to have revenue of 33.028 billion dollars, an 82.27% increase compared to the same period last year. The EPS is expected to increase by 88.11% to 0.70 dollars compared to the same period last year.
Datacenter business revenue.
NVIDIA's datacenter business revenue reached a record high of $26.3 billion in the second quarter, with analysts predicting it to rise to a new high of $29.53 billion in the third quarter. In August this year, CEO Jensen Huang stated that data centers worldwide are undergoing full-scale modernization of the computing stack through accelerated computing and AI generation.
NVIDIA's datacenter business revenue reached a record high of $26.3 billion in the second quarter, with analysts predicting it to rise to a new high of $29.53 billion in the third quarter. In August this year, CEO Jensen Huang stated that data centers worldwide are undergoing full-scale modernization of the computing stack through accelerated computing and AI generation.
Morgan Stanley has raised the target price of NVIDIA's stock from the previous $150 to $160, while maintaining an "Overweight" rating. The strength of the datacenter business growth is cited as the reason. The company's analysts state, "Amid increasing expectations for AI generation, the demand for AI and machine learning hardware solutions is strong, and they anticipate that the datacenter business will drive growth in the next five years."
Wall Street collectively raised NVIDIA's target stock price.
According to the latest TipRanks and moomoo data, multiple major financial institutions such as Melius, Morgan Stanley, and Mizuho simultaneously raised NVIDIA's target stock price before the earnings reports. The current average target stock price on Wall Street is $157.8, with an expected upside of 6.43%. The highest target price has reached an astonishing level of $200.
According to the latest TipRanks and moomoo data, multiple major financial institutions such as Melius, Morgan Stanley, and Mizuho simultaneously raised NVIDIA's target stock price before the earnings reports. The current average target stock price on Wall Street is $157.8, with an expected upside of 6.43%. The highest target price has reached an astonishing level of $200.
Piper Sandler has designated NVIDIA as a 'top pick,' focusing on the upcoming Blackwell architecture. Their analysts position NVIDIA as a top priority stock, highlighting NVIDIA's overwhelming advantage in the AI accelerator market as they prepare for the introduction of Blackwell architecture, expected to further expand the total size of the AI accelerator market by 2025 and secure the largest market share.
Morgan Stanley expects its gross profit margin in the third quarter to improve. Blackwell is expected to lead the rise in the company's stock price. The company is optimistic that Blackwell's revenue for the January period, which may reach $5 billion to $6 billion, exceeds the market consensus of $36.5 billion in revenue for the January period.
Mizuho predicts that NVIDIA's quarterly guidance will lay a strong foundation for growth in 2025. With the AI accelerator market showing continued vitality before the earnings announcement, NVIDIA is expected to announce guidance for the January quarter, reinforcing the growth foundation for 2025.
Goldman Sachs points out that Blackwell's supply improvement will have a significant positive impact on earnings per share (EPS) per share. The company has reconfirmed its "buy" rating on NVIDIA and has added it to the "conviction buy list." Goldman predicts that the first quarter earnings to be announced in April next year will be a real breakthrough. They are expecting Blackwell's progress and the improvement of supply conditions to significantly boost EPS.
Backed by the large-scale investment of major high-tech companies, the company's stock price has tripled compared to the end of 2023.
NVIDIA's stock price closed at $141.98 on November 17, rising to about three times its value by the end of 2023. Even after increasing by 3.4 times in 2023, the stock price continues to rise. NVIDIA's high-performance semiconductors are considered essential for the development of AI and the introduction of AI services. $Microsoft (MSFT.US)$Massive investments in equipment by major tech companies, such as, are supporting the growth. Sales revenue from the datacenter division dealing with AI-related semiconductors amounted to $26.272 billion in the 5-7 period, accounting for 87% of total revenue.
NVIDIA's stock price closed at $141.98 on November 17, rising to about three times its value by the end of 2023. Even after increasing by 3.4 times in 2023, the stock price continues to rise. NVIDIA's high-performance semiconductors are considered essential for the development of AI and the introduction of AI services. $Microsoft (MSFT.US)$Massive investments in equipment by major tech companies, such as, are supporting the growth. Sales revenue from the datacenter division dealing with AI-related semiconductors amounted to $26.272 billion in the 5-7 period, accounting for 87% of total revenue.
According to Bloomberg, NVIDIA's Price Earnings Ratio (PER) based on the latest stock price and estimated earnings for the next 12 months is 39.9 times, which is almost the same level as the previous earnings announcement (39.1 times). The average target price by analysts is $165.65, about 16% higher than the current level. HSBC notably raised the target price to a maximum of $200. Among the 41 analysts, 40 recommend a "buy" and 1 recommends a "hold."
Issues with the next-generation chip server rack design? What is the impact on performance?
In March this year, NVIDIA announced the next-generation AI chip Blackwell and planned to ship it in the second quarter. However, overheating issues arose later, leading to a situation where server rack designs had to be changed. This has caused delays in product rollout and raised concerns about customer deployment plans.
In March this year, NVIDIA announced the next-generation AI chip Blackwell and planned to ship it in the second quarter. However, overheating issues arose later, leading to a situation where server rack designs had to be changed. This has caused delays in product rollout and raised concerns about customer deployment plans.
In particular, servers equipped with the Blackwell GPU are experiencing serious overheating in high-capacity racks, which could limit GPU performance and cause hardware damage. To address this, NVIDIA has requested design changes from suppliers and is progressing with the optimization of cooling systems. While these improvements are part of the normal development process, it has resulted in unavoidable delays in delivery. Due to the latest overheating issues, there is a possibility of further delays in GB200 shipments, yet NVIDIA's AI chips are still facing supply shortages on the demand side.
In the AI chip market, NVIDIA holds about 90% of the global share, and its dominant position remains unshaken. The company stated, "Currently, customers are eager to adopt the GB200 system early and secure market dominance."
According to NVIDIA's spokesperson, design adjustments are being made as part of the development process, aiming to ensure performance and reliability in the end. The revised Blackwell GPU is scheduled to start mass production at the end of October and to be shipped as early as the end of January next year. This delay will impact customers such as Google, Meta, and Microsoft in terms of AI model training and product development plans.
A $50 billion share buyback plan
Against the backdrop of slowing business growth, a new $50 billion share buyback plan was approved in the second quarter. Currently, NVIDIA's PE (price-earnings) ratio and PCFR (Price Cash Flow Ratio) are below the two-year average. If Blackwell becomes a factor further pushing up the stock price, it is believed that the management will need to expand the scale of share buybacks in the third quarter.
Against the backdrop of slowing business growth, a new $50 billion share buyback plan was approved in the second quarter. Currently, NVIDIA's PE (price-earnings) ratio and PCFR (Price Cash Flow Ratio) are below the two-year average. If Blackwell becomes a factor further pushing up the stock price, it is believed that the management will need to expand the scale of share buybacks in the third quarter.
Overall, if NVIDIA does not significantly promote the $50 billion new share buyback plan or if Blackwell's sales outlook falls below the market's expectations, it could be a negative signal.
moomoo News Zeber
Source: moomoo, Bloomberg, TipRanks
This article utilizes auto-translation in some parts.
Source: moomoo, Bloomberg, TipRanks
This article utilizes auto-translation in some parts.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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184295026 : This is already confirmed to be a significant drop after the N-Vee earnings report in the early morning of Thursday the 21st, no matter how you look at it. It will follow the same pattern as the significant drop after the earnings report at the end of August. In the previous earnings report, it was pointed out that there were structural flaws in Blackwell, and it was explained that they would overcome this in the fall and transition to full-scale production. However, the problem has not been resolved even by the fall, that's the reality.
湯川学 : Concerns about delayed deliveries, there is no 100% perfect company.![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
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Isn't the decline an opportunity to buy?
最短最速でFIRE : While the target stock price has been raised across the board, the single option market has become intense.
Heaven or hell?
さいとう きみこ 184295026 : Help me.
なんおう : Even if I watch news of individual stocks, I don't quite understand. Is it the case that everyone sells once whether the financial results are good or bad?
穏やかなアビー_7479 184295026 : Please run away!
It's fine to come back later!
It's a company with a solid track record!
Making a profit is important! Both for the company and the investors.