Nvidia Earnings: Chipmaker Faces Daunting Q3 Challenge Amid Sky-High Expectations
After surging nearly 20% from the beginning of the month, Nvidia (NASDAQ:NVDA) stock hit and all-time high of $499.60 before undergoing a correction on Wednesday, closing the day down 1.55%. The $500 level, which is a major psychological level, seemed to have generated profit-taking just like it did at the end of August and the beginning of September.
Against this backdrop, investors are wondering whether to expect a sustained correction phase for the stock, or whether it's just a brief breather before new highs.
However, a large part of the answer will be provided by the quarterly results due next Tuesday, November 21, after the market closes.
Before going into the details of consensus forecasts and speculating on the possibility of a good or bad surprise for this key earnings report, let's recall that recent news has been rather positive for Nvidia.
In particular, the most recent gains have been driven by the announcement that Nvidia has upgraded its H100 artificial intelligence processor.
The new chip, which takes the name H200 and will be available in the second quarter of 2024, boasts as its main improvement high-bandwidth memory, one of the most expensive parts of the chip that defines the amount of data it can process quickly.
Nvidia dominates the AI chip market, powering OpenAI's ChatGPT service and many similar generative AI services.
The addition of high-bandwidth memory and a faster connection to the chip's processing elements means that these services will be able to produce a faster response.
The launch of this new chip is also seen by analysts as a response to the challenges posed by competitors seeking to challenge its dominance in the artificial intelligence sector.
The quarterly results due next Tuesday
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