Nvidia (NVDA) reported third-quarter results after the bell Tuesday that beat Wall Street expectations, as the artificial intelligence hype cycle remains front and center for investors.
The chipmaker reported earnings per share of $4.02 on revenue of $18.12 billion, both above analysts’ expectations. Analysts had expected earnings per share of $3.36 on revenue of $16.1 billion, according to Bloomberg data.
The company’s revenue forecast for the current quarter is $20 billion, plus or minus 2%; analysts were forecasting a fourth-quarter forecast of $17.8 billion.
New restrictions on chip exports to China were a concern in the report and Nvidia CFO Colette Kress confirmed they would impact the company’s sales in the future.
“Our sales in China and other relevant destinations, derived from products now subject to licensing requirements, have consistently contributed approximately 20-25% to data center revenue in recent quarters ” Kress said in a statement.
“We expect our sales to these destinations to decline significantly in the fourth quarter of fiscal 2024, although we believe this decline will be more than offset by strong growth in other regions.”
The chipmaker reported revenue of $14.51 billion for its data centers, which includes its AI chips. The Street was hoping for revenue of $12.82 billion. Nvidia’s gaming revenue was $2.86 billion for the quarter, also higher than the $2.7 billion expected by analysts.
Shares of the chipmaker were down about 1% in after-hours trading Tuesday.
This report comes after the stock closed at a record high of $504.09 per share on Monday, with AI once again becoming the story of the moment for investors amid the ongoing drama surrounding Sam Altman’s departure from the computer maker. ChatGPT OpenAI and its decision to join Microsoft (MSFT).
Nvidia’s stock moved significantly when it reported earnings this year. In August, the stock hit a record high after Nvidia reported second-quarter results that beat Wall Street’s expectations for revenue and earnings per share, as well as beating high estimates. Last May, an analyst called the company’s forecast “advice for the future.”
Printing could also have significant implications for the entire market. Nvidia has been a driver of stock market momentum this year as a key member of the “Magnificent Seven” stocks — alongside Apple (AAPL), Alphabet (GOOGL, GOOG), Microsoft (MSFT), Amazon (AMZN) , Meta (META) and Tesla (TSLA).
Together, these stocks have gained more than 70% this year through mid-November, compared with a 6% rise for the remaining 493 stocks in the S&P 500.
Julian Emanuel, chief executive of Evercore ISI, noted Sunday that “it’s still NVDA world” and warned investors to prepare for “post-NVDA volatility” regardless of how stocks perform.
Josh Schafer is a reporter for Yahoo Finance.
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