Why Nvidia stock is falling after quarterly results analysis Q2 2025 ? 4 Reasons why NVDA is falling

Overview of Nvidia's Quarterly Results hi everyone this is vinot here and welcome to my channel in today's video we'll be discussing about nvidia's quarterly results so there are four things that we will be covering in today's video so first one is we'll be looking at nvidia's quarterly results and we'll be looking at the positives that are there in this quarterly results and the third one is we look at despite the very good results why is Nvidia stock dropping and in the fourth part we'll look at how uh what the chart is trying to tell us we'll do a technical analysis of the chart nvidia's chart and we'll try to find out what the chart is trying to tell us so nvidia's result has been one of the most uh expected ones because it is a very huge company uh it has a significant weight in both the S&P 500 Index as well as a NASDAQ IND index and it's a very big company it's a$3 trillion company and it's one of the fastest companies to move from two trillion to $3 trillion so there was a lot of expectations or uh from everybody like from the analyst from the market from the market participants from the news channels everybody they were waiting for this particular results to come out and we'll be discussing that results in today's video so the first one is that the quarterly results have been very good like as you can see from here it recorded a quarterly revenue of $30 billion it was up from by 15 percentage from quarter 1 and almost 122% from a year ago and especially the major Revenue driver which is the data center Revenue um um is around 26.3 billion and it grew by 16 percentage and almost like 154 percentage from a year ago so data center is the main um contributor for nvidia's U revenues mainly driven by uh the AI Trend because a lot of companies like Facebook like meta Google and all of these like companies are investing heavily in the data centers so that was one of the main drivers of nvidia's revenues now let's look at the numbers uh this is sources barrance so you can see here it did Nvidia did beat the market expectations on both earnings per share as well as Revenue so on earnings per share it came out to be 68 cents versus Market expectation of 65 and the revenue was also more than what the market expected so the market expectation was 28.7 billion but Nvidia came out with 30 billion uh and up by almost 122% uh so it did beat uh the market expectations on both EPS as well as revenue and the company also announced uh that it would raise the size of the buyback that it's been doing like it is Raising it to 50 billion which is like a small number when compared to its market cap of more than 3 trillion so as you can see these are very good numbers from Nvidia so let's now look at the positives so the first one is that Positive Highlights from Nvidia's Performance um so the first positive is that it did beat uh the revenue and uh EPS expectations from the market and the Outlook that was given that is for the current quarter uh is also very good um as well as for the next quarter as you can see from here the revenu is expected to be around 32.5 billion uh for the next quarter and nvdia also expects to maintain like the same um like almost the same gross margins as as well and they also confirmed that they will have similar market share of the AI chips there have been a number of news around other like other players capturing nvidia's market share but it doesn't look like it's happening right now so Nvidia is still continuing to dominate the AI chips market and data center uh revenues and the major positive that I took from the revenue like from the earnings call as well as from the presentation was that there is a huge demand for the Blackwell chips which is the next generation of AI chips that is going to come from Nvidia and earlier uh earlier this month there were some issues around or concerns around there being design flaws around the Blackwell chip and that was a reason for the sharp correction in nvidia's price it almost came down to $98 uh or $90 I think uh a few weeks back and this was the main driver of uh the um the main the main concern for the price correction was the uncertainty around the Blackwells design but then today they clarified that it's not an issue with the design itself but it's only the issue with the production of the chips so which reduce fears a little bit and they have also said that they have already started shipping this new generation of AI chips to some of their uh current customers and partners which is a very good sign so these were the major positives that is it beat the market expectations the Outlook is is very good and the fears around the design flaw that they said that there is no design flaw in the chip that's only a production issue and they already started uh saying that they have a strong demand for this new generation of chips so those were the major positives from the nvidia's call as well as from the quarterly presentation as you can see uh the the Nvidia did come out with very good numbers as well as beat Market expectations but still the stock price seems to be coming falling uh down and we'll now look at some of the reasons Reasons for Nvidia's Stock Price Decline why uh the stock price nvdia stock price is coming down so the first reason why Nvidia stock price is Falling Down is because this is the number one reason it did beat Market expectations but it didn't beat by much so the it was a surprise but the surprise wasn't big enough like investors have gotten used to getting bigger surprises in the previous quarters as we did say at the start of this video the expectations from theet Market was already Skyhigh and nvida did beat those expectations but still the element of surprise wasn't big enough for a price move to the upside so that's the reason why we are seeing the price come down even after such good numbers and after beating Market expectations so the number one reason is that it was a it did beat the market expectations it did surprise the market a bit but it wasn't a bigger surprise that uh that could move the price in the upward Direction uh so that's number one reason the second reason is the concern around the margins there has been a slight decline around 3 percentage in the margins this could be due to the suppliers increasing their uh input costs or could be the M reason why the um the the margins seems to be having declined so this is a second important reason why the stock price did not move like there are concerns around the margins as well but in their out out look they did say that they expect to maintain similar 75 percentage um in their Outlook they did mention that they expect around similar uh margins around 75 percentage is what they are expecting so which is a pretty good margin um uh in this particular industry there were also some other concerns around uh uh the Blackwell demand so the in the conference call they were the analysts were asking for how much is the demand and they refused the management refused to put a number or uh on the revenues that might come from Blackwell they just give a qualitative measure saying that they are they are expecting strong demand and theyve already started seeing strong demand but they didn't put a number on this uh demand or how much revenue they can expect from Blackwell so that is one of the concerns like they refused to give a number for Blackwell demand and revenue and uh there are also concerns around whether there will be continued uh investments in data centers given that a AI Trend there was considered around the concerns around the return on investment on AI so will the same level of capex spending continue from the big players or they will they continue to invest in AI infrastructure uh that that was another concern so these are the reasons uh why we we saw that the Nvidia stock price moving down uh or heading one of the important things to take away from this recent price action is that uh though nvda did beat the market expectations and did come out with very good numbers we have to know we have to know that market markets are always forward-looking so because there are concerns around the profit Revenue margins in future and whether the same level of a investment and investment in data center would continue uh that's the reason why the stock price is heading south so always remember that market is always forward looking it does not uh matter about what happened in the past but it's always looks and it's a discounting machine and it's always trying to Discount what will happen in the future now coming back to what I feel is that I've already mentioned this on Twitter as well uh the Gen AI trend is just getting started and what we are seeing now is just the first wave the first wave is where the infrastructure providers like uh semiconductor chip manufacturers like Nvidia qualcom and Cloud providers like uh Microsoft Google and Amazon with their web service Amazon web services Azure and they they are the ones they are laying the foundation for this AI trend and the second uh way would be coming from the application providers the likes of Microsoft sales for service now adob who will be using these AI uh services to uh reduce their costs and as well as increase a productivity so the second wave is what we'll see a major uh change so I think the Nvidia is well positioned in this particular Market in the infrastructure space and U yeah now let us look at the chart I what and try to understand what the chart is trying to uh in this final section we'll do a Technical Analysis and Future Outlook technical analysis of nbds chart on a daily time frame as you can see from here I did post this on trading view before the earnings call I did say that uh the stock could go in either direction if it did beat the market Expectations by a big margin then we could have broken out of this symmetrical triangle but since it did beat by only a small element of price we are seeing that the price is correcting but it's not even correcting by much like it moved around 6 or 7 percentage down which is a very small percentage when you compare to the yearly gains that Nvidia has made and the pattern that we are seeing here the symmetrical triangle is very similar to the pattern that we saw in the earlier breakout as well um the previous quarters the element of surprise was very large we'll have to wait and watch uh whether nvidia's price would further correct and and consolidate for a few more weeks or months before it tries to move much higher uh it's one of the biggest players in of in the AI Trend and in the data center revenues and it has a very huge market share and currently there are there don't seem to be any challenges uh to CH some or any of the chip uh makers to challenge nvidia's dominance in this particular space and the demand for GPU data uh is very strong and and uh that that's my personal opinion of of course you need to consult with your own financial advisor before you make any financial decisions um yeah this is what the chart is trying to tell us I think for a few days or a few weeks we might see that the price might further correct and might correct for and consolidate in the narrow range before we break out uh break out to the next uh breakout and move higher if you did learn something new today please do consider subscribing to this channel uh thank you thank you