Proactive Investors - Investor expectations are high for Nvidia Corporation (NASDAQ:NVDA) heading into the company’s third quarter earnings report due on Tuesday, November 21 after the market close.
Wall Street analysts expect the chipmaker to report an almost 480% year-over-year increase in earnings per share to $3.36.
Revenue is expected to grow about 173% to $16.19 billion, in line with Nvidia’s forecast of revenue of $16 billion plus or minus or $320,000.
Analysts at the Bank of America (NYSE:BAC) (BoA) expect a beat and raise from Nvidia when it hands down its 3Q report.
They noted that investor focus would be the impact of China export restrictions and whether Nvidia’s new products can launch in time to offset the restrictions on current-generation products.
“We sized China 2025 fiscal year/2024 calendar year sales impact as $8 billion to $10 billion gross and $4 billion to $5 billion net including benefit of redesigns,” they wrote in a note to clients.
They also highlighted that Nvidia needs to forcefully counter the narrative its products are too expensive for generative AI inference amid competitive concerns around Advanced Micro Devices, Inc. (NASDAQ:AMD)’s MI300 accelerator.
The BoA analysts also highlighted that Nvidia’s HGX H200 accelerators unveiled at Supercomputing 23 were a notable upgrade to its already leading H100 offerings. It is compatible with its predecessor H100 installations, enabling a faster time to market.
“We view the latter point as critical, as hyperscalers do not need to invest to reconfigure their existing hardware platform, incentivizing customers to remain key partners of NVDA,” they wrote.
“Already, NVDA announced major cloud service providers (CSPs) Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT), Coreweave, Lambda Labs, Vultr (and others) will support H200-based instances next year.”
The analysts maintained their ‘Buy’ rating on Nvidia stock and awarded it a US$650 price target.
Nvidia shares traded hands at about US$495 on Tuesday morning ahead of its earnings report after reaching an all-time high of about US$505 on Monday, and have gained about 230% in the year to date.
- Updated with share price movement -