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- 🗞️ Nvidia Beats Q2 Estimates
🗞️ Nvidia Beats Q2 Estimates
PLUS: Why is MongoDB soaring?
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Market Performance
S&P 500: 6,481.40 ⬆️ 0.24%
Nasdaq: 21,590.14 ⬆️ 0.21%
Dow Jones: 45,565.23 ⬆️ 0.32%
Nvidia Delivers as AI Demand Stays Red-Hot
Nvidia (NVDA) reported better-than-expected earnings and revenue on Wednesday, signaling that demand for artificial intelligence infrastructure shows no signs of fading.
The chipmaker earned $1.05 per share on $46.74 billion in revenue, beating analyst estimates of $1.01 per share and $46.06 billion, respectively.
The company expects its revenue this quarter to be $54 billion, plus or minus 2%, which is ahead of analyst expectations of $53.1 billion.
However, the stock slipped in extended trading as data center revenue of $41.1 billion fell slightly short of the $41.34 billion estimate for the second straight quarter.
Finance chief Colette Kress told analysts the company expects between $3 and $4 trillion in AI infrastructure spending by the end of the decade.
Revenue rose 56% year-over-year, marking the ninth straight quarter of 50%+ growth, though this was the slowest growth period in that stretch.
Nvidia's gaming division reported $4.3 billion in sales, up 49% year-over-year, while its robotics division generated $586 million with 69% annual growth.
NVIDIA stock is fundamentally strong and has a Ziggma score of 99. However, it ranks in the bottom-half percentile in terms of valuation.
Our Takeaway
While Nvidia's numbers beat expectations, the slight data center revenue miss and stock decline after hours suggest investors are becoming more demanding of perfection.
The company's massive AI infrastructure spending forecast validates the long-term thesis, but quarterly execution will remain critical as competition intensifies.
Learn from this investor’s $100m mistake
In 2010, a Grammy-winning artist passed on investing $200K in an emerging real estate disruptor. That stake could be worth $100+ million today.
One year later, another real estate disruptor, Zillow, went public. This time, everyday investors had regrets, missing pre-IPO gains.
Now, a new real estate innovator, Pacaso – founded by a former Zillow exec – is disrupting a $1.3T market. And unlike the others, you can invest in Pacaso as a private company.
Pacaso’s co-ownership model has generated $1B+ in luxury home sales and service fees, earned $110M+ in gross profits to date, and received backing from the same VCs behind Uber, Venmo, and eBay. They even reserved the Nasdaq ticker PCSO.
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Market Overview
Markets climbed to fresh highs on Wednesday as investors looked past President Trump's unprecedented move to fire Fed Board Governor Lisa Cook.
The S&P 500 notched its latest record close as optimism around falling interest rates and rising earnings supported risk appetite.
Terry Sandven of U.S. Bank Asset Management noted that "interest rates are on the cusp of being lowered, and earnings are trending higher.
In aggregate, inflation, interest rates, and earnings trends support a risk-on bias."
Bank of America warned that current low volatility levels appear "unsustainable" as concerns mount over both an AI bubble and the Fed's independence.
However, the firm believes any autumn sell-off would represent a strong buying opportunity given subdued volatility and continued dip-buying behavior.
Stock Moves Deciphered 📈
Albemarle Corporation (ALB) +7.53%
Albemarle surged after UBS upgraded the stock and forecast rising lithium prices due to Chinese supply disruptions, signaling strong demand for the EV battery material.
ServiceNow (NOW) +2.71%
ServiceNow gained amid broad strength in the tech sector and positive analyst sentiment, with the stock trading at key support levels ahead of Nvidia's earnings report.
Paramount Global (PARA) -6.04%
Paramount declined after Morgan Stanley cut its price target to $10, reflecting ongoing investor concerns about merger integration challenges and the company's strategic transformation.
Headlines You Can't Miss
👕 American Eagle surged 8.5% after announcing Travis Kelce's partnership, launching a limited-edition collection just the day after his Swift engagement.
🍯 Cracker Barrel rebounded 8% after reversing a controversial logo change following social media backlash and criticism from Trump.
👔 Ralph Lauren benefits from Swift-Kelce engagement photos featuring the brand's apparel, with Jefferies calling it a "mission success" for the luxury retailer.
☕ J.M. Smucker dropped 5% after missing Q1 estimates and warning Q2 earnings will fall 25% due to smaller coffee profits.
🍩 Krispy Kreme shed 6% following JPMorgan's downgrade, citing the canceled McDonald's partnership disrupting operations.
₿ Bitcoin threatens $111,000 support after falling from $125,000 high, potentially signaling broader market weakness ahead.
🏛️ White House adviser Hassett pressures Fed Governor Cook to take leave despite her lawsuit challenging Trump's removal order.
Trending Stocks
MongoDB (MDB) +38%
The database platform developer soared after beating Wall Street estimates with adjusted earnings of $1 per share on $591 million revenue, well above the consensus of $0.66 per share on $556 million revenue. Strong AI demand drove the outperformance.
Kohl's (KSS) +24%
The department store chain jumped after second-quarter adjusted earnings of 56 cents per share crushed expectations of 29 cents. Revenue of $3.35 billion also topped the $3.32 billion estimate, with management citing disciplined business execution.
Canada Goose (GOOS) +16%
U.S. shares of the luxury parka maker climbed after controlling shareholder Bain Capital received bids to take the company private. The offers value Canada Goose at approximately $1.35 billion.
What’s Next?
Key Earnings to Watch 👇
DICKS’s Sporting Goods (DKS) is forecast to report revenue of $3.61 billion vs. $3.47 billion last year. Earnings per share are expected to narrow from $4.37 to $4.30.
Dollar General (DG) is forecast to report revenue of $10.68 billion vs. $10.21 billion last year. Earnings per share are expected to narrow from $1.7 to $1.57.
Best Buy (BBY) is forecast to report revenue of $9.23 billion vs. $9.29 billion last year. Earnings per share are expected to narrow from $1.34 to $1.22.
Track upcoming news and earnings on your portfolio companies with Ziggma.
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