NVIDIA Corporation (NVDA) Stock: Earnings Lead To Excitement



NVIDIA Corporation is having an incredible start to the trading session today, and for very good reason. Yesterday, the company reported its earnings for the most recent quarter after the closing bell, beating all expectations. Today, we’ll talk about what we saw from earnings, how the market reacted to the news, and what we can expect to see from NVDA moving forward. So, let’s get right to it…

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NVDA Reports Solid Earnings

As mentioned above, NVIDIA reported its earnings for the fiscal fourth quarter yesterday after the closing bell. However, the earnings report was a shocker as the company blew away expectations and produced record results. Here’s what we saw:

  • Earnings Per Share – In terms of earnings per share, analysts expected for NVDA to report earnings in the amount of $0.32 per share. However, the company actually produced record earnings at $0.52 per share, absolutely blowing away analyst expectations.
  • Revenue – In terms of top-line revenue, NVDA also did incredibly well. While analysts expected the company to produce $1.31 billion in overall revenue for the quarter, the company actually produced $1.4 billion in revenue for the quarter. Not only does this figure beat expectations, it shows a 12% year-over-year growth in top line revenue, driven by sales of graphics processing units for gaming and professional visualization.

On top of beating earnings and revenue projections, the company also announced guidance for the first quarter above expectations. While analysts expect the company to generate $1.22 billion in the quarter, NVDA is expecting to generate around $1.26 billion. In a statement, Jen-Hsun Huang, co-founder and CEO of NVIDIA Corporation had the following to say:

We had another record quarter, capping a record year. Our strategy is to create specialized accelerated computing platforms for large growth markets that demand the 10x boost in performance we offer. Each platform leverages our focused investment in building the world’s most advanced GPU technology… NVIDIA is at the center of four exciting growth opportunities – PC gaming, VR, deep learning, and self-driving cars. We are especially excited about deep learning, a breaktrhough in artificial intelligence algorithms that takes advantage of our GPU’s ability to process data simultaneously.”

How The Market Reacted To The News

As investors, we know that few factors have the ability to move the market quite like earnings. After all, investors are ultimately investing for growth, and earnings give them a way to gauge growth. With that said, following the overwhelmingly positive earnings report from NVDA, the stock is climbing in a big way. Currently (9:36), the stock is trading at $30.55 per share after a gain of $2.89 per share or 10.45% so far today.

What We Can Expect To See Moving Forward

Moving forward, I have a relatively bullish expectation of what we can expect to see from NVIDIA. The reality is that the company has proven its ability to grow and that demand for its products are high. So, I wouldn’t expect the growth trend to stop any time soon. However, it is important to remember that the market tends to move through a series of overreactions. Therefore, it wouldn’t be surprising to see a slight correction, bringing NVDA off of highs in the short term. Nonetheless, in the long term, I’m expecting this stock to soar!

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What Do You Think?

Where do you think NVDA is headed moving forward? Let us know your opinion in the comments below!

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