NVDA

NVIDIA Corporation

154.34
USD
-3.43%
154.34
USD
-3.43%
151.70 346.47
52 weeks
52 weeks

Mkt Cap 399.55B

Shares Out 2.50B

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Nvidia Stock Sank in After-Hours Trading Today — Here's Why the Stock Could Be a Solid Buy

What happened Shares of Nvidia (NASDAQ: NVDA) fell in after-hours trading on Thursday, as investors responded to the chipmaker's lower-than-expected guidance. As of 6:40 p.m. ET, Nvidia's stock price was down more than 6% after rising 5% earlier in the day. So what Nvidia's revenue soared 46% year over year to $8.29 billion in its fiscal 2023 third quarter, which ended on May 1. This impressive growth was fueled by an 83% surge in data center sales, to $3.75 billion, and a 31% increase in gaming revenue, to $3.62 billion. "We delivered record results in Data Center and Gaming against the backdrop of a challenging macro environment," founder and CEO Jensen Huang said in a press release. "The effectiveness of deep learning to automate intelligence is driving companies across industries to adopt Nvidia for AI computing." Despite supply chain disruptions that have plagued the tech sector, Nvidia was able to manage its costs effectively. Its adjusted gross margin actually rose by 90 basis points (1 basis point equals 0.01%) to 67.1%. This, combined with Nvidia's strong sales growth, helped its adjusted operating income grow by 55% to $3.96 million. Its adjusted earnings per share, in turn, increased 49% to $1.36. Now what Investors, however, appeared to focus more on Nvidia's financial forecast for its fiscal 2023 second quarter. Management guided for revenue of roughly $8.1 billion, which was below Wall Street's estimates of more than $8.5 billion. Nvidia noted that war in Europe and coronavirus-related lockdowns in China were likely to negatively affect its sales results by approximately $500 million. Still, Huang highlighted the company's promising slate of new offerings due out later this year, and he remains optimistic that powerful trends will continue to fuel Nvidia's long-term expansion. He said: We are gearing up for the largest wave of new products in our history with new GPU, CPU, DPU, and robotics processors ramping in the second half. Our new chips and systems will greatly advance AI, graphics, Omniverse, self-driving cars and robotics, as well as the many industries these technologies impact. Thus, patient, long-term-minded investors may wish to use the sell-off as an opportunity to buy the tech leader's shares at a discount. 10 stocks we like better than Nvidia When our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* They just revealed what they believe are the ten best stocks for investors to buy right now... and Nvidia wasn't one of them! That's right -- they think these 10 stocks are even better buys. *Stock Advisor returns as of April 27, 2022 Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

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