The results of the chipmaker, Nvidia, which is scheduled to release its earnings next week, might have a significant impact on the stock market, according to Gene Munster of Deepwater. Munster emphasized that the reason for this interest is Wall Street’s current preoccupation with artificial intelligence (AI). Nvidia is a significant supplier of the processors used in the creation of artificial intelligence, thus the company’s second-quarter results announcement on August 23 may boost the market as a whole.
All eyes are on Nvidia’s data center number, according to Munster, who anticipated that the segment’s revenue will be $8 billion. If Nvidia performs better than expected, it might benefit the overall market, especially the Nasdaq. On the other hand, meeting expectations could be viewed as a letdown.
Munster concurred with a prior Morgan Stanley analysis that forecasted Nvidia will outperform quarterly expectations and increase outlook. He also mentioned that at a conference in late June, just before the quiet period preceding the earnings report, the company’s CFO was upbeat about robust worldwide demand and downplayed worries about US-China trade barriers.
Munster noted that the expected data center revenue of $8 billion for Q2 is almost 110% more than the same figure for the prior year to provide additional context.
It’s important to note that during the most recent fiscal fourth quarter, Microsoft reported a 10% increase in sales and a 17% increase in its cloud business. Munster underlined that, in terms of AI leadership, comparing Nvidia and Microsoft is like comparing apples and oranges.
In conclusion, given the present focus on AI technology, the market is anticipating Nvidia’s earnings report since its success could have a big impact on the stock market.
