On April 28, 2024, binary code was displayed on a laptop screen and the Nvidia logo was displayed on a mobile phone.
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NVIDIA Shares of the company fell in U.S. premarket trading Thursday second fiscal quarter Gross profit margins fell slightly, and its revenue growth also eclipsed amidst rising expectations.
The company’s shares fell 4.6% in early pre-market trading, but pared losses to 1.46% at 10:47 London time (05:47 ET).
Nvidia reported on Wednesday that its July quarter revenue exceeded $30 billion, an annual increase of 122%.
This is the fourth consecutive quarter of triple-digit revenue growth. But as Nvidia continues to expand rapidly, year-to-year comparisons are becoming increasingly difficult.
Nvidia reported better-than-market revenue guidance of $32.5 billion for its fiscal third quarter. This represents 80% year-over-year growth, but a slowdown from the June quarter.
At the same time, the company said that its gross profit margin for the full year will be “around 70%.” Analysts expected full-year profit margins of 76.4%, according to StreetAccount.
However, analysts said Nvidia would have to far exceed all expectations to see its stock price rise after the digital announcement.
Thursday’s pullback also follows a rapid rise in shares, which have seen Nvidia shares rise more than 150% so far this year. The stock has risen more than 750% since the start of 2023, making it one of the biggest beneficiaries of the artificial intelligence boom. Big tech companies have been increasing investment and buying Nvidia’s graphics processing units to train large artificial intelligence models.
The current decline in Nvidia’s stock price has also suppressed the stock prices of global semiconductor companies, including well-known companies such as memory manufacturer Samsung and chip manufacturers. British Semiconductor lower on Thursday.
Nvidia addressed another issue on the earnings call – reported delays in its next-generation Blackwell AI chips.
“In the fourth quarter, we expect Blackwell’s revenue to be in the billions of dollars,” Nvidia Chief Financial Officer Colette Kress said on a conference call with analysts.
The company also announced $50 billion stock buyback plan.
– CNBC’s Kif Leswing contributed to this report.
