CNBC Today AFTER NVIDIA Earnings On NVIDIA, NVIDIA Stock - NVDA Update

CNBC hold on let's get those numbers Simo Modi has them Nvidia Simo what does it look like John second quarter earnings are in for NVIDIA 68 cents adjusted versus the estimate of 64 Cent so a beat on its bottom line revenue at 3.04 billion also higher than Wall Street consensus of 28.7 billion we have comments here from CEO Jensen Wong in the press release Hopper demand remains strong and the anticipation for Blackwell is incredible he says Nvidia achieved record revenues as global data centers are in full throttle to modernize the entire Computing stack he goes on to say that Blackwell samples are shipping into shipping to our partners and customers Spectrum X ethernet for AI and Nvidia AI enterprise software are two new product categories achieving significant scale another data point here Nvidia announcing a $50 billion repurchase of shares we are watching the stock here uh move fractionally higher in overtime John we'll get you the guidance in just a second uh all right we'll await that guide looks like it's a little bit above a little bit above expectations Nicole what do you do with it here if you feel like you missed the big move the earnings beats are narrowing I think that's exactly what I was watching over your shoulder as the market was trying to digest in the moment when the earnings beats are narrowing the the street is less impressed on where we're headed next and so I think until there's more clarity around movement outside of the hyperscalers obviously adoption from Finance from healthc care from the consumer consumers like we started to hear from Walmart that's the next leg and so I think the more we learn about Blackwell what the Stack's going to do the demand for the stack and these higher even higher margin products right this next gen next wave that's what moves us higher and so I wouldn't say this isn't an entry point because we believe that we are long Nvidia for 18 plus months here along those lines Paul the fact that you had Revenue up 152% year-over-year but perhaps more significantly or Revenue up 122% year over-year um which represents another quarter of more than doubling I mean it would it tripled in the last quarter so it does represent a deceleration in that rate of growth and I wonder how much that is factoring into the stock as you see these rapid moves on your screen right now but we're we're currently down 4% yes so I mean I think you know we talked about you know earlier before it released they were going to have to exceed 30 billion just to you know keep the Market uh somewhat level here but to your point they've been increasing revenues so high revenues have more than uh quadrupled U over the last three years that's not going to happen again over the next three years just you know just you'd have to have revenues of over 500 billion a year in order to keep that pace going so the pace is going to slow and so we we we always hear about oh it's trading at a cheaper valuation now than it was a year ago but the growth was so much stronger over the last the last year that pace of growth is going to slow I'm not saying that Nvidia is a stock that you don't want to own but you have to reset your expectations here that what we've seen in the growth is going to slow down going forward and you know I think there's other places that where investors can look in the market outside of just these mag seven type stocks and you want to look for a broadening of the rally to areas that you know we're not talking about every day that 75 analysts aren't covering and that The Wall Street Journal and Bloomberg and and CNBC aren't reporting stories about newly minted millionaires because of Nvidia stock there's going to be a new new crop of stocks going forward and that's where you want to look at uh as an investor well it's certainly something we've been looking at here at overtime specifically I want to get back to SEMA Modi she's got more details from this Nvidia report SEMA Q3 Revenue guidance Morgan is being looked at here at $ 32.5 billion that is higher than Wall Street estimate of 31.7 billion and if we were just to break out the data center revenue for the quarter 26.3 billion that is above the street expectation of 25.2 but as we know the bar was high going into this the into this report the emphasis being on the size of the beat and the raise the conference call does begin at 5:00 p.m Eastern I would also just Point again to that $50 billion buyback Shares are down 5% in overtime John and Morgan all right sea thanks Pat Morehead stocks now down 5% it was down as much as eight or nine of course the story changes rapidly and you can't count on anything uh directionally certainly before the earnings call Blackwell mentioned a couple times here in the release but nothing necessarily about volume delivery right uh that's exactly right and you know data center is up 154% but it's just not good enough investors could be reacting to what came out in the CFO CFO note which talked about Blackwell having a mask set change I'm I'm reading this uh right now and they expect uh to begin shipping in the 4 quarter and to fiscal what's a set change yeah Mas set is essentially a metal change that goes in you have to actually change the design and go into The Foundry to increase yield and anytime yield is disgust John uh it sets off panic and and that's exactly what I'm what I'm reading here e even if it's you know I think on the call they have to talk about uh what kind of a shift could this mean it'd be great for them to say no change all of our customers are going to are going to fill this in but yeah they they are talking about a a a an issue with black that that that was rumored okay all the more reason to tune in to the call here as we count down to that in a little over 30 minutes Mike Sant you want to get your thoughts on what we're seeing as we do see these rapid ticks on the screen here in overtime in the stock we had had we had a guest on the show yesterday and he said you know looking at the options action what was pric was a 9 to 10% move in either direction for NVIDIA yeah all day today about 11% move was uh was priced in to based on how the atone options were trading that doesn't necessarily mean it's perfectly predicted but it shows you uh what people were willing to bet on and the results as everybody's been saying this sort of deceleration certainly still amazing growth but relative to expectations just not really vating them by as much of a margin the smallest earnings beat in any quarter in the last year and a half for NVIDIA up till now was like 9% this beat by less than 5% uh on on adjusted uh EPS so still good the the revenue guide 800 million higher than than the street was at for the the coming quarter all of that's in the positive direction but you know the market kind of got there and I think it's almost going to be somewhat comforting or maybe soothing uh to investors not to have to feel like you're chasing this incredibly fast moving story um this company added a 100 billion in annual revenue like over the course of 2 years it added like a Target over 2 years it was impossible to keep up with that pace so we'll see where it settles out you know from here uh it's not a crazy valuation but it's one that's ramped so fast $50 billion uh buyback is nice guess what the stock traded literally $50 billion worth of stock today alone so it's not exactly uh something that's going to soak up a ton of Supply to that point there is a lot of money in Nvidia stock moving in overtime right now this is a $3 trillion market cap stock it was down 8 9% at one point higher lower now it's down about 3% in overtime but the call still to come thank you Paul hickey Nicole Webb Patrick Morehead and of course we Mike Santo who we might see later we often see him later all right we got much more reaction to Nvidia and the rest of today's earnings on the way up next analyst Angelo Zeno is going to give us his first take on nvidia's results and what he wants to hear from Management on the call at the top of the hour shares of Nvidia meanwhile still lower by about 42% after the company reported a beat on the top and bottom lines announced a $50 billion buyback for more let's bring in cfra senior Equity analyst Angelo Zeno he's got a buy rating $139 price Target on the stock Angelo it looks like there is indeed some adjustment that Nvidia is doing in the production process for the Blackwell platform uh how much more do we need to know about that well I I think we kind of want to know you know a little bit more in terms of kind of um you know how what the ramp is going to look like in terms of black will here over the next couple of quarters you know clearly it's been delayed here um I think really what investors want to know and when you kind of look at the numbers here right I mean you look at the actual July quarter numbers they were pretty good beat the data center number by a little bit north of a billion dollars or so through 15% sequentially when you kind of look at the guide here for the the October quarter it implies this sequential increase of less than 10% it's kind of the lowest sequential increase we've seen since essentially kind of the Microsoft open AI announcement of 10 billion plus back in early 2023 so um you know obviously the beaten raises are going to be more difficult to come by partly we think at least going into the October quarter is this delayed Blackwell ramp I do think you've got the potential now to potentially see a re acceleration once that blackw ramp um actually takes place here but we kind of need to know a little bit more details in kind of what the trajectory of that looks like yeah but Angelo is this kind of like Nvidia is the US Women's team in the 4x400 relay they were so far ahead that if they want if they run one leg a little slower than they could does it really affect the metal I mean listen I I I really don't think it does right so um you know at the end of the day I guess you can make that comparison I think you know I think Nvidia right now is perfectly okay with where they sit here um the numbers in our view again were were pretty good um the guidance I think was okay as well I think what you're if you're an investor right now you kind of have to look ahead into calendar 2025 Blackwell will launch it will ramp um we think it's going to be an enormous cycle because of the fact that it is going to be more of this platform based ramp so if you are selling your shares here after hours uh we would be careful for that because this is going to be a free cash flow monster even if the year-over-year growth rates are clearly going to decelerate that is you know pretty much well reflected in the valuations here we think and along those lines I we've seen more than 33 million shares change hands just here in overtime since this report uh was released I I just I want to take a little deeper into this because they also said in the release that Hopper demand remains strong so it raises the question for me how many folks are going to continue to focus on Hopper even if you have a delay in Black well or is that going to be deferred spending like how to think about that mix yeah I mean listen I I think we'll get a little bit more detail here on the call as well but you the H2 h200 just recently rent it's it's not like it's been out for you know over a year so it just kind of you know ran over the last couple of months so we're still early in kind of the age 200 ramp and we do think there is significant demand we do think kind of uh demand continues to house strip Supply and you've kind of you know alluded or you've kind of heard a number of these hyperscale uh providers here over the last couple of months kind of allude to the fact that they're going to me remain aggressive um you know buyers here so as far as the h100 h200 is concerned here at least over the next couple of months we do think kind of um you know these FL companies are essentially going to kind of you know in invest aggressively on of these Hopper gpus because essentially that's the only thing out in the market right now until Blackwell ramps okay Angelo Zeno thanks for joining us with a buy FinVid reading okay let's talk about Nvidia earnings today so Nvidia reported revenue of $30 billion in nonap EPS of 68 C so they beat expectations on both revenue and EPS as for guidance Nvidia raised their outlook for next quarter's Revenue to $32.5 billion which is also higher than consensus estimates of roughly ion as I've mentioned in recent videos on this channel I thought Nvidia needed to raise revenue guidance for next quarter by $2 billion or more above consensus estimates in order to satisfy Market participants in the short term and unfortunately we did not get that today Nvidia did raise guidance for next quarter and they did raise guidance higher than consensus estimates but this is after multiple quarters of raising guidance billions of dollars higher than consensus estimates the same did not happen today and so this is in the short term being perceived as somewhat of a disappointment even though next quarter's guidance was technically a beat of consensus estimates additionally in invidious gross margin this quarter was 75.1% which is down 3.3 points sequentially from last quarter as for Blackwell Nvidia CFO said that samples are shipping to customers now in Black Wells production ramp is scheduled to begin in the fourth quarter and continue into fiscal 2026 CFO colet Crest also said that Nvidia executed a change to the Blackwell GPU mask to improve production yield and CEO Jensen Hong later said that the change to the mask is complete in Blackwell is expected to ship in Q4 Jensen reiterated that demand for Hopper is strong and demand for Blackwell is incredible and on top of all of that Nvidia authorized a $50 billion share repurchase while leaving the cash dividend unchanged so overall I would say that Nvidia reported a great quarter that being said many Market participants perceive this report as an indication that the rate of growth is slowing and I'll be honest that is concerning don't get me wrong Nvidia reported a great quarter and the company is still solid I still expect Nvidia to have solid growth over the next year I just think that the market May now gradually start to view Invidia stock more like a typical Mega cap Tech stock with more predictable earnings growth and therefore we may not see the rapid growth and sub quent hype that we've seen thus far in nvidia's stock the company is still growing in the short term though the hype May Decline and that is concerning in the short term because that introduces the potential for some form of multiple contraction I'm not saying that the stock crashes but I am saying that expectations for bombastic earnings growth is decreasing and therefore a tighter multiple may be gradually applied to Nvidia stock most of the mag s stocks trade at about 20 or 30 something times current earnings and at the time I'm making this video Nvidia is now trading in after hour somewhere around 55 times current earnings so while that is not insanely High is higher than many of the other mag seven stocks that trade around 20 or 30 something times their current earnings so I'm not saying that Nvidia is going to crash and I'm not saying that Nvidia isn't a good long-term investment that's not at all what I'm saying what I am saying is that right now the growth rate appears to be slowing as a result there is likely to be less hype surrounding Invidia moving forward and as such Market participants are now more likely to apply a tighter multiple to Nvidia stock and consider putting Capital to work in other areas of the market that have received less attention relative to the mag 7 while this is not great for NVIDIA in the short term this could be positive for the broader Market as a lead to more broadening and therefore a more fundamentally sound Market rally in the future in which the market as a whole is moving higher rather than just Mega cap Tech moving higher so that's what I'm thinking right now regarding Nvidia it will take some time for me to really digest these results and also for the rest of the market to digest these results with that being said I hope you all have a great rest of your day and I'm curious to hear your thoughts about Nvidia in the comments below please leave a like on this video so more people will see it and while you're down there please consider subscribing it's free and you can always change your mind thanks for watching and hopefully I'll see you in the next video