Nvidia (NASDAQ: $NVDA) will release its second quarter fiscal 2025 results on Wednesday, August 28, after market close. The company’s report could have huge implications for the AI sector.
Nvidia’s Highly Anticipate Results
NVDA stock will be the focus this week as it prepares to release the highly anticipated second-quarter results. Investors are looking for sustained growth in its data center segment and the progress of its Blackwell chips.
Nvidia Stock Performance In 2024
Nvidia stock is up 168.57% in 2024, with analysts optimistic it could rise further. In the past 12 months, it has risen 176.20%. The stock is trading significantly above its 50 and 200 DMAs of $120.90 and $86.08, respectively.
The stock has been quite volatile in August. On August 5, the stock dropped below $100 before rebounding for six consecutive days, starting on August 12 to August 19. The stock closed trading on Friday, August 23, at $129.37 per share.
What Analysts Expects
Nvidia’s recent dip at the start of August was in line with most of the stock market due to the impact of yen-carry trades. A design flaw detected in the Blackwell chip also led to speculation that deliveries would be delayed.
Despite the Blackwell chips setback, Nvidia remains the leader in the AI chip industry, dominating 80% of the industry. However, competition is heating up. AMD, its main rival, announced on August 19 that it had acquired ZT Systems for $5 billion to boost GPU sales. On the day after the announcement, NVDA dipped 2%.
No matter the results, Nvidia’s Q2 earnings will be a key indicator for the future of the chips sector. They will act as an indicator of the future of stock price movements for the entire industry.
How Rivals Performed
OPM July 30, AMD beat expectations for revenue and profit, with revenue up 9% to %.84 billion, while EPS rose 19% to $0.69. The company also forecast robust demand from the AI industry.
In contrast, Intel missed estimates, reporting a net loss of $1.6 billion compared to a net income of $1.48 billion the previous year. Intel’s CEO attributed the loss to a decision to ramp up the production of AI-capable Core Ultra PC chips.
Nvidia Forecast After Record Q1 Results
In the first quarter of fiscal 2025, Nvidia reported revenue of $26 billion, a 262% YoY increase. For the second quarter, Nvidia forecast $28 billion in revenue, and a non-GAAP gross margin of 75.5%. In the second quarter of fiscal 2024, Nvidia reported $13.51 billion in revenue and a non-GAAP gross margin of 71.2%.
Analysts expect Nvidia to beat its own guidance with revenue of $30 billion and an average EPS forecast of $0.65.
In terms of stock price, analysts forecast NVDA will rise 15.86%, on average, to $149.89, with a range of a high of $200 and a low of $100. They give the stock an overall strong buy rating. The most optimistic analysts forecast that Nvidia’s market cap could rise to $6 trillion by the end of 2024 from the current $3.2 trillion market cap.
Is Now The Time To Add Nvidia To your Portfolio
Nvidia began as a pioneer in the video game sector with record-beating processors. It has since adapted its technology to meet the needs of the AI industry, cornering most of the market.
It currently has a trailing P/E ratio of 75.70, which is on the high end. However, it is still more than half that of AMD, which has a trailing P/E of 184.50. The valuation could drop further after the second quarter results when new record-high profits are factored in.
While some investors may shy away from paying for stock at 50 times its earnings, Nvidia has proven itself with triple-digit revenue growth and a dominant market share in the AI sector.
Based on these factors, Nvidia could potentially deliver huge wins for your portfolio in the coming months.
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