Nvidia stock has surged 16% in the past month. The chipmaker is outpacing other Big Tech companies as demand for AI chips soars. Nvidia is on track to overtake Apple as the world’s most valuable public company by market cap.
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Nvidia’s Earnings Surge: Is It Time to Invest in Big Tech?
AI Demand Drives Nvidia’s Growth
Nvidia CEO Jensen Huang recently spoke about the company’s upcoming Blackwell AI chip. He called demand for it “insane” in a CNBC interview. This sparked an 18% rally in Nvidia shares, pushing the stock price to $130.
The Biden administration might cap AI chip exports to certain countries. This briefly halted the stock’s rise. But it soon recovered.
Impressive Earnings, But Growth May Slow
Nvidia’s recent earnings were strong. In Q3 2024, revenue jumped 206% to $18.1 billion. Data center revenue rose even more, up 279% to $14.5 billion. Growth is expected to continue, but it may slow compared to last year’s gains.
Investors reacted oddly after Q2 earnings. Despite beating expectations, the stock fell 6% after the announcement. It took over a month for the share price to recover.
Mixed Performance Across the AI Sector
Not all AI-related stocks have seen equal gains. Broadcom is up 59% year-to-date, beating the S&P 500’s 21% rise. Qualcomm and AMD have grown more modestly. Intel has struggled, falling 55% amid restructuring efforts.
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Investor Focus for Upcoming Earnings
As earnings season nears, investors will watch for:
Continued AI spending from major tech companies
Updates on Blackwell chip rollout and supply issues
Performance of other chip companies as market indicators
Nvidia’s earnings announcement comes later than most. Wall Street sees it as a key indicator for the AI chip market.
NVDA Earnings: A Market Bellwether
Nvidia’s upcoming earnings report is crucial. It will show if the AI boom is still strong. Other tech giants like Microsoft, Google, and Meta rely on the company’s chips. Their spending patterns will impact Nvidia’s performance.
The market will also look at Nvidia’s guidance. Any hints about future demand or supply constraints could move the stock. Nvidia’s performance often influences the entire tech sector.
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Investors should watch Nvidia stock closely. Its earnings could signal broader trends in Big Tech and AI. The next few weeks will be key for Nvidia and the tech industry as a whole.