Nvidia is expected to report its second-quarter earnings next week amidst the global AI boom. Analysts expect Revenue to be around $7.2 billion, but Nvidia is bargaining on about $11 billion for the quarter – a 64% jump on last year. Why?
They can’t get enough of Nvidia’s graphics processor chips. Tech firms are stockpiling these chips. Tesla CEO, Elon Musk, has told analysts that they will take as many Nvidia graphics processor chips as the company can produce. This high demand for Nvidia tech is the cause of rising stock prices.
Nvidia is the preferred maker of both the high-powered graphics chips needed to run AI programs and the software required to develop AI platforms.
These figures could be the measuring stick for the whole AI industry, and any lower-than-expected profits could put a damper on the entire AI tech industry. But there seems to be no stopping Nvidia as share prices hit $445, up a staggering 204%.
Morgan Stanley’s Joseph Moore sees a rosy outlook for Nvidia, “NVIDIA remains our Top Pick, with a backdrop of the massive shift in spending towards AI, and a fairly exceptional supply-demand imbalance, that should persist for the next several quarters; we think the recent selloff is a good entry point.”
Nvidia’s expected results next week and the hype around it indicate why AI tech stock is one of the favourites of investors.
