provided a revenue forecast for the October quarter that was below expectations, citing a difficult macroeconomic environment and a rapid fading of demand. Its shares fell in after-hours trading.
The semiconductor company reported adjusted earnings per share of 51 cents for the July quarter, compared with the consensus estimate of 50 cents among analysts tracked by
FactSet . Revenue came in at $6.7 billion, which was in line with both a negative preannouncement
) had issued earlier and analysts’ recently reduced expectations.
The big news was the outlook. For the current quarter, Nvidia said revenue will be in a range with a midpoint of $5.9 billion, which was way below the consensus call of $6.9 billion.
“We are navigating our supply chain transitions in a challenging macro environment and we will get through this,” said Jensen Huang, founder and CEO of Nvidia, in the release.
Nvidia shares fell 4.7% following the report.
Earlier this month, Nvidia preannounced disappointing results for its fiscal second quarter. At the time it blamed weaker-than-expected gaming segment sales.
On a conference call to discuss the results, management said Nvidia saw a “sudden slowdown” in demand. Both prices and the number of units sold deteriorated during the quarter, an executive said. Nvidia was “unable to quantify” the extent to which reduced cryptocurrency mining drove the decline in gaming card sales.
In a phone interview after the call, Chief Financial Officer Colette Kress said Nvidia’s products using their new chip architecture will be “coming soon.” When asked if the pricing structure for the current generation Ampere cards is sustainable for the next one, she said they will look at market conditions at launch to set pricing.
Regarding the potential for stronger competition this upcoming cycle from
), Kress said their cards have a stronger brand with gamers and dominate the rankings for the most-used cards on gaming services. She also expressed confidence the partnerships they have with game publishers and Nvidia’s more advanced software features would beat the competition.
Some analysts are worried that demand for Nvidia’s graphics cards might stay weak due to its exposure to crypto-mining, elevated pricing for its high-end cards, and the negative effects from a deteriorating global economy.
Nvidia’s stock had declined by 41% this year as of Wednesday’s close, versus the 27% drop in the iShares Semiconductor ETF (SOXX), which tracks the performance of the ICE Semiconductor Index.
Nvidia’s Revenue Forecast Falls Short. The Stock Drops.
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Nvidia stock had declined more than 40% this year as of Tuesday’s close.
Justin Sullivan/Getty Images
Nvidia
provided a revenue forecast for the October quarter that was below expectations, citing a difficult macroeconomic environment and a rapid fading of demand. Its shares fell in after-hours trading.
The semiconductor company reported adjusted earnings per share of 51 cents for the July quarter, compared with the consensus estimate of 50 cents among analysts tracked by
FactSet
.
Revenue came in at $6.7 billion, which was in line with both a negative preannouncement
Nvidia
(ticker:
NVDA
) had issued earlier and analysts’ recently reduced expectations.
The big news was the outlook. For the current quarter, Nvidia said revenue will be in a range with a midpoint of $5.9 billion, which was way below the consensus call of $6.9 billion.
“We are navigating our supply chain transitions in a challenging macro environment and we will get through this,” said Jensen Huang, founder and CEO of Nvidia, in the release.
Nvidia shares fell 4.7% following the report.
Earlier this month, Nvidia preannounced disappointing results for its fiscal second quarter. At the time it blamed weaker-than-expected gaming segment sales.
On a conference call to discuss the results, management said Nvidia saw a “sudden slowdown” in demand. Both prices and the number of units sold deteriorated during the quarter, an executive said. Nvidia was “unable to quantify” the extent to which reduced cryptocurrency mining drove the decline in gaming card sales.
In a phone interview after the call, Chief Financial Officer Colette Kress said Nvidia’s products using their new chip architecture will be “coming soon.” When asked if the pricing structure for the current generation Ampere cards is sustainable for the next one, she said they will look at market conditions at launch to set pricing.
Regarding the potential for stronger competition this upcoming cycle from
Advanced Micro Devices
(
AMD
), Kress said their cards have a stronger brand with gamers and dominate the rankings for the most-used cards on gaming services. She also expressed confidence the partnerships they have with game publishers and Nvidia’s more advanced software features would beat the competition.
Some analysts are worried that demand for Nvidia’s graphics cards might stay weak due to its exposure to crypto-mining, elevated pricing for its high-end cards, and the negative effects from a deteriorating global economy.
Nvidia’s stock had declined by 41% this year as of Wednesday’s close, versus the 27% drop in the iShares Semiconductor ETF (SOXX), which tracks the performance of the ICE Semiconductor Index.
Write to Tae Kim at [email protected]
Source: https://www.barrons.com/articles/nvidia-stock-earnings-guidance-51661285729?siteid=yhoof2&yptr=yahoo