Nvidia beats targets with strong Q2 results, stock drops post-report due to valuation concerns

From Nasdaq: 2024-09-01 07:40:00

Nvidia (NASDAQ: NVDA) impresses with second-quarter results, beating Wall Street targets with earnings per share of $0.68 on sales of $30 billion. Despite strong performance, stock loses ground post-report, prompting concerns about valuation peak. Positive outlook supported by strong gross margins and upcoming Blackwell chip release in late 2024 or early 2025.

AI-driven demand boosts Nvidia’s gross margins, leading to a strong showing with a 75.1% gross margin in Q2. Expectation for mid-70s margin throughout fiscal year signals consistent pricing power. Current GPUs for data centers maintain strong pricing, new chip platform set for release to fuel further growth.

Nvidia’s upcoming Blackwell chips, set for production ramp-up in Q4, offer a promising future. Bull case for stock remains intact with resilient pricing power and advanced GPU technology on the horizon. Despite recent post-earnings volatility, the stock is expected to bounce back and climb higher, supported by positive trends.



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