Investing.com – Released a second quarter that beat expectations and promised higher earnings and success next quarter than Wall Street’s forecasts.
NVIDIA, the technology company, reported second-quarter results that beat expectations and provided optimistic guidance, driven by increased adoption of AI architecture and rising demand for its chipsets.
NVDA shares rose more than 9% in after-hours trading following the announcement. The company reported adjusted earnings per share of 2.70 on total revenue of $13.51 billion for the quarter. That beat analysts’ expectations, as it reported revenue of $2.07 million on total revenue, according to Investing.com.
NVIDIA’s business recorded a significant increase of 171%, reaching $10.32 billion in the second quarter over the previous year. This growth is due to companies shifting towards accelerated computing and structural AI rather than general purpose computing.
Demand for NVIDIA’s AI-related products, such as chips for training AI models and cloud services, has made it a top choice for startups and companies looking to expand into the AI field.
The company’s revenue from its games business rose 22% to $2.49 billion in the quarter.
For the fiscal third quarter, the company issued a forecast of $16 billion in total revenue, with a possible margin of plus or minus 2%. According to Investing.com, it is looking at projections of $12 billion. Total margins are expected to be between 71.5% and 72.5%, plus or minus 50 basis points.
The chipmaker also announced plans to buy back an additional $25 billion in shares, with buybacks expected to continue throughout the year.
Nvidia’s guidance is expected to strongly boost the tech stock market, especially as it is expected to pick up momentum in the artificial intelligence sector. Positive forecasts indicate that corporate AI spending could receive a significant boost, benefiting various AI-related companies, including Microsoft MSFT, Google (NASDAQ:) GOOGL, ORCL, PLTR, MonogoDB and SNOW, among others.
Analysts at Wedbush noted that they expect this spending momentum to lead to an $800 billion increase in business and consumer spending over the next decade.
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