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What's in the Offing for NVIDIA (NVDA) This Earnings Season?
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NVIDIA Corporation (NVDA - Free Report) is slated to release first-quarter fiscal 2022 results on May 26.
For the fiscal first quarter, the company expects revenues of $5.3 billion (+/-2%). The Zacks Consensus Estimate for the same is pegged at $5.4 billion, indicating 75.3% growth from the year-ago reported figure.
The Zacks Consensus Estimate for quarterly earnings is pegged at $3.28, suggesting a year-over-year improvement of 82.2%.
The company’s earnings beat the Zacks Consensus Estimate in all the preceding four quarters, the average surprise being 10.7%.
Let’s see how things have shaped up prior to the announcement.
Factors at Play
NVIDIA’s fiscal first-quarter performance is likely to have benefited from growth across all its business segments.
The company’s growth opportunities in ray-traced gaming, rendering, high-performance computing and AI are likely to have been driving factors during the period in discussion. A series of blockbuster AAA titles, which pledged support for the NVIDIA RTX ray tracing technology, might have been a positive.
NVIDIA is also anticipated to have benefited from strength in its data-center business on the growing adoption of cloud-based solutions amid the coronavirus crisis-induced work-from-home wave. Increase in Hyperscale demand and growing adoption in the inference market are likely to have been tailwinds during the to-be-reported quarter.
Additionally, the pandemic-induced remote-working wave is likely to have bolstered sales of graphic chips utilized in desktops and laptops. This, in turn, is anticipated to have aided the quarterly performance.
Furthermore, the company’s Automotive and Professional Visualization divisions had shown improving trends last quarter. Though Automotive segment’s revenues fell 11% year-on-year, it increased 16% sequentially during fourth-quarter fiscal 2021 on higher sales of AI cockpit solutions and continued recovery in the global automotive production volumes.
Professional Visualization revenues (6% of revenues) declined 7% year over year in the fourth quarter, but improved 30% quarter on quarter, primarily on the rebound in desktop workstations as consumers returned to offices and organizations resumed purchases that had been deferred due to the pandemic.
We expect the trends in Automotive and Professional Visualization to have continued in the first quarter of fiscal 2022.
Nonetheless, disruptions in retail channel sales due to lockdown and social-distancing measures implemented by governments across the world to contain the spread of coronavirus might have partially offset the benefit of solid demand for the remote-working and online-learning hardware infrastructure.
What Our Model Says
Our proven model predicts an earnings beat for NVIDIA this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
NVIDIA has an Earnings ESP of +1.96% and carries a Zacks Rank of 2.
Other Stocks With the Favorable Combination
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:
Pure Storage, Inc. (PSTG - Free Report) has an Earnings ESP of +10.81% and currently carries a Zacks Rank of 3.
Nutanix Inc. (NTNX - Free Report) has an Earnings ESP of +1.76% and carries a Zacks Rank #3, at present.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Image: Shutterstock
What's in the Offing for NVIDIA (NVDA) This Earnings Season?
NVIDIA Corporation (NVDA - Free Report) is slated to release first-quarter fiscal 2022 results on May 26.
For the fiscal first quarter, the company expects revenues of $5.3 billion (+/-2%). The Zacks Consensus Estimate for the same is pegged at $5.4 billion, indicating 75.3% growth from the year-ago reported figure.
The Zacks Consensus Estimate for quarterly earnings is pegged at $3.28, suggesting a year-over-year improvement of 82.2%.
The company’s earnings beat the Zacks Consensus Estimate in all the preceding four quarters, the average surprise being 10.7%.
NVIDIA Corporation Price and Consensus
NVIDIA Corporation price-consensus-chart | NVIDIA Corporation Quote
Let’s see how things have shaped up prior to the announcement.
Factors at Play
NVIDIA’s fiscal first-quarter performance is likely to have benefited from growth across all its business segments.
The company’s growth opportunities in ray-traced gaming, rendering, high-performance computing and AI are likely to have been driving factors during the period in discussion. A series of blockbuster AAA titles, which pledged support for the NVIDIA RTX ray tracing technology, might have been a positive.
NVIDIA is also anticipated to have benefited from strength in its data-center business on the growing adoption of cloud-based solutions amid the coronavirus crisis-induced work-from-home wave. Increase in Hyperscale demand and growing adoption in the inference market are likely to have been tailwinds during the to-be-reported quarter.
Additionally, the pandemic-induced remote-working wave is likely to have bolstered sales of graphic chips utilized in desktops and laptops. This, in turn, is anticipated to have aided the quarterly performance.
Furthermore, the company’s Automotive and Professional Visualization divisions had shown improving trends last quarter. Though Automotive segment’s revenues fell 11% year-on-year, it increased 16% sequentially during fourth-quarter fiscal 2021 on higher sales of AI cockpit solutions and continued recovery in the global automotive production volumes.
Professional Visualization revenues (6% of revenues) declined 7% year over year in the fourth quarter, but improved 30% quarter on quarter, primarily on the rebound in desktop workstations as consumers returned to offices and organizations resumed purchases that had been deferred due to the pandemic.
We expect the trends in Automotive and Professional Visualization to have continued in the first quarter of fiscal 2022.
Nonetheless, disruptions in retail channel sales due to lockdown and social-distancing measures implemented by governments across the world to contain the spread of coronavirus might have partially offset the benefit of solid demand for the remote-working and online-learning hardware infrastructure.
What Our Model Says
Our proven model predicts an earnings beat for NVIDIA this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
NVIDIA has an Earnings ESP of +1.96% and carries a Zacks Rank of 2.
Other Stocks With the Favorable Combination
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this quarter:
Digital Turbine, Inc. (APPS - Free Report) has an Earnings ESP of +6.98 and currently sports a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Pure Storage, Inc. (PSTG - Free Report) has an Earnings ESP of +10.81% and currently carries a Zacks Rank of 3.
Nutanix Inc. (NTNX - Free Report) has an Earnings ESP of +1.76% and carries a Zacks Rank #3, at present.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>