Nvidia (NVDA) is set to release third quarter earnings after the bell on Tuesday as Wall Street eagerly awaits an update on the fundamentals that drive the artificial intelligence hype cycle.
This report follows the stock’s record high close of $504.09 per share on Monday, with AI once again grabbing investors’ attention amid the ongoing drama surrounding Sam Altman’s departure from ChatGPT maker OpenAI and his move to join Microsoft (MSFT)amid the ongoing drama.
The company is expected to outperform its performance in the same quarter last year, with an anticipated revenue of $16.1 billion versus $5.93 billion and an adjusted EPS of $3.36 versus $0.58. Data center revenue is expected to reach $12.82 billion, up from $3.83 billion, and gaming revenue is expected to hit $2.7 billion, up from $1.57 billion.
Investor focus will also be on Nvidia’s revenue outlook, with Wall Street anticipating fourth quarter guidance to reach $17.8 billion. Revenue guidance has been a surprising factor for investors in 2023, with the company consistently exceeding expectations.
“We expect NVDA to beat/raise consensus when it reports on Nov. 21,” noted Bank of America research analyst Vivek Arya, expressing positivity about the stock’s valuation.
However, the stock’s momentum stumbled for a few months following its August report as investors started to question Nvidia’s valuation, and updates on chip restrictions in China challenged assumptions about the company’s market size.
In an SEC filing after the announcement, the company stated it does not anticipate near-term impact from the new restrictions. Stifel analyst Ruben Roy expects similar commentary from Nvidia on Tuesday.
Nvidia has been a driving force in the stock market this year as part of the “Magnificent Seven” stocks, gaining more than 70% through mid-November against a 6% rise for the remaining 493 stocks in the S&P 500. Evercore ISI senior managing director Julian Emanuel noted that “it’s still NVDA’s world,” and warned investors to be prepared for “post-NVDA volatility” regardless of the stock’s direction.
Josh Schafer is a reporter for Yahoo Finance.
Click here for the latest technology news that will impact the stock market.
Read the latest financial and business news from Yahoo Finance
