According to a statement on Nvidia's official website, the chip manufacturer has scheduled to release its performance report for the fourth quarter of the 2024 fiscal year at 02:00 Pacific Time on Wednesday, February 21, after the US stock market closed in the early hours of Thursday, February 22, Beijing Time.
According to media data, Wall Street currently expects Nvidia's quarterly revenue to exceed $20 billion, which is more than three times that of $6.05 billion in the same period last year. In addition, the market expects the company's earnings per share to rise to $4.59, compared to $0.88 per share in the fourth quarter of the 2023 fiscal year.
For the full year of fiscal year 2024, analysts expect total revenue to increase by 118% to $59 billion. According to data from S&P Global Market Intelligence, Microsoft, Apple, Amazon, Google, and Meta have never recorded such growth rates at similar starting points. If this number is true, Nvidia will also surpass Intel to become the second largest chip company in the world.
In addition, investors will also pay attention to clues about the company's long-term trends. Currently, the market expects revenue for the fiscal year 2025 ending in January 2025 to approach $92 billion, with a year-on-year increase expected to reach 56%. But some argue that even if Nvidia can provide a report that exceeds the above expectations, its stock price will find it difficult to replicate the upward trend of previous financial reports.
A year ago, on February 23, 2023, Nvidia surged 14% after announcing its performance; On May 25th of the same year, the day after the performance announcement, the stock price rose by an additional 24%. But after the last two financial reports, the stock price slightly increased by 0.1% and decreased by 2.4% respectively, which may reflect the market's digestion of the positive performance. It is difficult to see a surprising double-digit increase in the market afterwards.
On the contrary, the market is beginning to worry that Nvidia's potential pullback may even reverse the rise of the S&P 500 index since the beginning of this year. Over the past year, the rebound of Nvidia and the US stock market has surprised many on Wall Street. After recording a 239% increase in 2023, Nvidia further rose by 46% in 2024, and the S&P 500 index rose by 24% and nearly 5% respectively.
Some people believe that in this financial reporting season, the performance of many technology companies has not yet matched the increase in their stock prices. Bank of America analyst Vivek Arya said that given investors' previous "blind pursuit of artificial intelligence," he believes that it is not surprising that Nvidia's stock price experienced a "significant but brief pullback" after the financial report was released.
Michael Kramer, founder of asset management company Mott Capital, said that Nvidia contributed a quarter of the S&P 500 index's rise this year, so this week's financial report is a watershed for market trends. "In my opinion, the market has placed a huge bet on a company. If Nvidia doesn't have a significant upward trend, what makes the stock market continue to rise?"
According to data from the SpotGamma platform, which focuses on analyzing the options market, the skewness of Nvidia's call options has reached its highest level since June. Founder Brent Kochuba believes that the market may fall along with Nvidia as call options linked to a large number of major US companies may depreciate after the financial report.
Although analysts have a pessimistic view on Nvidia's stock price on the day of its financial report, the future of the company's business is still worth looking forward to. A month later, Nvidia will hold the GTC 2024 conference for AI developers, and there are reports that the company will release details of the next generation GPU chip "B100".
Recently, Morgan Stanley analysts mentioned in a client report that the B100 is expected to become a game changer for artificial intelligence, even more powerful than the previous generation flagship AI chip H100. Bank of America's Arya believes that Nvidia's upcoming B100 system will be priced at least 10% to 30% higher than the H100 system.
In addition, artificial intelligence research company OpneAI released its latest Sora model last week, which generates stunning video images through text and is expected to provide momentum for the stock price of AI sellers.
On the day Sora was released, Wedbush, Oppenheimer, and Wells Fargo Bank successively raised Nvidia's target price above $800, while Loop Capital even issued a forecast of $1200.