Reuters
- Nvidia on Thursday reported better-than-expected first quarter results.
- Revenue guidance for the second quarter was also ahead of expectations.
- Wall Street analysts were positive on Nvidia following the results.
- Watch Nvidia trade live.
Nvidia on Thursday evening reported better-than-expected first-quarter results, sending shares up more than 5% after the closing bell. They were set to open little changed on Friday.
The chipmaker earned an adjusted $0.88 a share on revenue of $2.22 billion, topping the $0.81 and $2.19 billion that analysts surveyed by Bloomberg were expecting.
"NVIDIA is back on an upward trajectory," said cofounder and CEO Jensen Huang. "We’ve returned to growth in gaming, with nearly 100 new GeForce Max-Q laptops shipping. And NVIDIA RTX has gained broad industry support, making ray tracing the standard for next-generation gaming."
Looking ahead to the second quarter, Nvidia sees revenue of $2.55 billion at the midpoint, plus or minus 2%. That was better than the $2.53 billion that analysts were hoping for.
Here’s what Wall Street analysts are saying about the results:
JPMorgan: ‘Solid Q1 Results/In-line Guide on Return to Normalized Gaming Demand; Datacenter On-Track for 2H19 Recovery’
Glassdoor
Price Target: $205
Rating: Overweight
"Although GPU channel inventories have largely normalized in the April quarter, gaming growth also appears to be held back somewhat by the well-known notebook CPU shortages, impacting the initial ramp of its notebook business," analyst Harlan Sur wrote.
"However, we expect seasonal growth in Gaming (augmented by ramp of 2nd gen Nintendo Switch) for the remainder of the year. In datacenters, the team noted that the July quarter guidance was softer than what they had originally anticipated due to large CSPs going through a period of digestion.
"However, we believe this view was largely expected as other large compute semiconductor companies such as Intel have guided towards a later recovery during their recent earnings call as well, and pointing to more of a 3Q and onwards type recovery with stronger growth in 2020."
Susquehanna: ‘Getting Back on the Rails’
Reuters
Price Target: $215
Rating: Positive
"Somewhat surprising, implied Gaming guidance beat our expectations, helped in part by
a strong return of Nintendo Switch sales as the Japanese company is expected to launch
a cost-reduced version of the device," analyst Christopher Rolland wrote.
"While CPU shortages weighed a bit, management announced 100 notebook wins as their new laptop parts gain further traction (up from 40 announced at CES). While we previewed the many issues with GPU in the Data Center in C1H19 (primarily hyperscale digestion), we were positively surprised by the strong narrative around a ramp in their T4 inferencing product.
He concluded: "Overall, it has been a harrowing few quarters, but we remain long-term bulls on NVDA, as we believe in the A.I. inference opportunity, proviz upgrade cycle, and 7nm refresh coming this fall."
Jefferies: ‘Reset is Healthy- Buy the Confession’
colbehr/Imgur
Price Target: $210 (previous $227)
Rating: Buy
"We continue to believe that NVDA will benefit from the secular drivers we outlined in our "4th Tectonic Shift in Computing" thesis, namely around demand for parallel processing in gaming, datacenters, autos and enterprises," analyst Mark Lipacis wrote.
"In the near term, we view management lowering the bar as a positive and expect the stock to appreciate as visibility improves and order rates increase."
See the rest of the story at Business Insider
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Source: Business Insider – jgarber@businessinsider.com (Jonathan Garber)