Fabless chipmaker Nvidia (NVDA) is poised to release its second-quarter fiscal year 2024 results on August 23. This earnings announcement holds significant attention from Wall Street. Below, we delve into the specific metrics to observe, how to access the release, and the projected figures analysts are anticipating from Nvidia.
Notable Metrics for Nvidia Stock
The 2023 fiscal year proved to be challenging for Nvidia, marked by an abrupt decline in demand for gaming chips, leading to lower revenues, excessive inventory, and decreased gross margins.
As outlined below, the first quarter of fiscal year 2024 showcased improvements over the preceding quarter. The upcoming release for the second quarter’s earnings will either extend this positive trajectory or halt it. Most analysts are optimistic about the second quarter results being positive—a promising sign not just for Nvidia, but also for the broader artificial intelligence (AI) market.
Nvidia holds the distinction of being the premier supplier of graphics processing units (GPUs) powering generative AI applications such as ChatGPT and Google Bard. The momentum and strength exhibited by Nvidia’s data center segment, encompassing its AI chips, are noteworthy. Should these trends persist, Nvidia could become a leading example of substantial growth attributed to the AI revolution.
Consequently, this earnings release may convey two crucial messages. Firstly, it will indicate whether Nvidia has effectively addressed the challenges faced during the 2023 fiscal year. Secondly, it may begin to quantify the economic value derived from AI.
The metrics to closely observe encompass the following:
- Topline revenue: Nvidia encountered stagnant revenue during fiscal year 2023, primarily due to subdued demand for gaming chips.
- Gross margin: Having declined in the prior year, it demonstrated signs of recovery in the first quarter.
- Data center revenue: This metric has exhibited growth, and sustained expansion will quantify Nvidia’s momentum in the AI domain.
- Gaming revenue: A substantial decline was witnessed in the second quarter of the preceding year, with the downturn continuing through the culmination of fiscal year 2023.
- Non-GAAP diluted EPS: Ultimately, analysts and investors are keen on witnessing growth in bottom-line profitability.
Nvidia’s Previous Earnings Performance
In the first quarter of fiscal year 2024, Nvidia disclosed revenue amounting to $7.19 billion, a non-GAAP gross margin of 66.8%, and a non-GAAP diluted EPS of $1.09. This performance notably surpassed analyst forecasts. The consensus among financial experts had predicted revenue of $6.52 billion and a non-GAAP diluted EPS of $0.92.
Comparing these key first-quarter metrics to historical data, they exhibited declines on a year-over-year basis while showing improvements over the previous quarter. Specifically:
- First-quarter revenue experienced a 13% decline compared to the first quarter of 2023, yet exhibited a 19% increase over the prior quarter.
- The first-quarter non-GAAP gross margin of 66.8% demonstrated a slight reduction from the result in the same quarter of the previous year, which was 67.1%, while showcasing an improvement from the previous quarter’s gross margin of 66.1%.
- Non-GAAP EPS for the first quarter decreased by 20% compared to the corresponding quarter of the prior year, but saw a 24% increase compared to the previous quarter.
Examining the segment-specific metrics, gaming revenue experienced a 22% increase from the previous quarter but sustained a year-over-year decrease.
In the data center sector, robust demand for Nvidia’s AI chips propelled revenue to a 14% rise year over year, reaching $4.28 billion. This result outperformed consensus estimates.
Following the release of the first-quarter earnings report, Nvidia’s shares surged by 26% during extended trading.
Upcoming Earnings Reporting Date and Time
Nvidia is scheduled to unveil its earnings summary for the second quarter of fiscal year 2024 on Wednesday, August 23, 2023, at 4:20 p.m. ET. During this time, access Nvidia’s investor website to access the earnings summary and read the written commentary on the quarterly results provided by CFO Colette Kress.
At 5 p.m. ET, the company will conduct a webcast, delivering prepared remarks and addressing questions from analysts and institutional investors. The webcast will be open to the public in a listen-only mode through the company’s investor website.
