Nvidia CEO Jensen Huang delivered a speech at The MGM during CES 2018 in Las Vegas on January 7, 2018.
Mandel Ngan | AFP | Getty Images
Shares of chipmaker Nvidia surged 5% in Thursday’s morning trading session as the company surpassed expectations in both revenue and earnings and provided robust guidance for the next quarter.
For the fiscal second quarter, Nvidia reported adjusted earnings per share of $2.70, exceeding the Refinitiv consensus estimate of $2.09. Additionally, the company generated quarterly revenue of $13.51 billion, surpassing the consensus estimate of $11.22 billion.
Analysts are particularly impressed with the strong guidance for the upcoming quarter, with Nvidia forecasting approximately $16 billion in revenue, representing a 170% increase compared to the same period last year.
Harlan Sur from JPMorgan raised his price target for Nvidia from $500 to $600 and reiterated an Overweight rating on the stock.
“The team managed to exceed expectations by delivering outstanding results and outlook, driven by the surging demand for its data center products,” noted Sur in a client note.
Nvidia shares have enjoyed a nearly uninterrupted run this year.
Nvidia stock opened at a new 52-week high, surging over 220% year-to-date. Notably, the company has achieved a market cap of over $1 trillion for several weeks now.
The heightened demand for Nvidia chips, driven by increased adoption of AI technology, has been a significant catalyst for the chipmaker. Nvidia, which has historically focused on graphics processing units (GPUs), has seen a surge in demand as companies from various industries seek to enhance their AI capabilities.
Nvidia expects this heightened demand to continue through 2024.
-Reported by Kif Leswing for CNBC.
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