Two weeks after Nvidia issued a sales and margin warning, all eyes are on the quarterly guidance that’s expected in the company’s Wednesday earnings report.
Among analysts polled by FactSet, the consensus is for Nvidia to report July quarter (fiscal second quarter) revenue of $6.7 billion, GAAP EPS of $0.35 and non-GAAP EPS of $0.50. The revenue consensus matches the figure for the quarter given in Nvidia’s August 8 pre-announcement.
For the October quarter — Nvidia typically shares quarterly sales, margin and expense guidance in its reports — the revenue consensus stands at $6.91 billion (down 3%).
Eric Jhonsa, Real Money’s tech columnist, will be live-blogging Nvidia’s earnings, which is expected at 4:20 P.M. Eastern Time, along with a conference call with management that’s scheduled for 5 P.M.
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4:26 PM ET: Also perhaps helping: The company is guiding for an FQ3 non-GAAP gross margin of 65%, plus or minus 50 bps. That suggests it doesn’t expect to take major inventory charges during the quarter.
4:25 PM ET: Perhaps helping out Nvidia’s shares: The company says that while Gaming and Professional Visualization segment revenue is expected to be down Q/Q in FQ3, Data Center and Automotive revenue is expected to be up.
4:24 PM ET: The FQ3 sales guide is well below consensus. But investor expectations were low following Nvidia’s warning. Shares are now up down just 0.6%.
4:22 PM ET: Shares are down 1.9% after-hours.
4:21 PM ET: Results are out. FQ2 revenue of $6.7B matches consensus. Non-GAAP EPS of $0.51 beats by $0.01.
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Nvidia guides for FQ3 revenue of $5.9B, plus or minus 2%. That’s below a $6.91B consensus.
4:11 PM ET: One thing to keep an eye on as Nvidia reports: Whether the company will be taking any more inventory-related charges in FQ3.
In its warning, Nvidia said it’s taking $1.32B worth of charges (primarily inventory-related) for FQ2, with the company’s GPU purchase commitments with foundries believed to be the main culprit. Due to the charges, Nvidia forecast an FQ2 non-GAAP gross margin of just 46.1% (+/- 50 bps), well below original guidance of 67.1%.
4:01 PM ET: Nvidia closed up 0.2%. The FQ2 report is expected at 4:20 PM ET.
4:00 PM ET: Along with its FQ3 sales guidance, any commentary Nvidia shares about demand trends for its Gaming and Data Center segments will be closely watched.
In its warning, the company estimated Gaming segment sales were down 33% Y/Y in FQ2, thanks to softer gaming GPU demand and channel inventory corrections. On the flip side, Data Center revenue was estimated to be up 61% Y/Y, thanks in part to strong server GPU demand from cloud giants.
3:56 PM ET: Ahead of the report, Nvidia’s stock is up 0.7% today to $172.90. But shares are still down 41% YTD, thanks to broader tech-sector weakness and concerns about gaming GPU demand trends.
3:53 PM ET: The FactSet consensus is for Nvidia to report FQ2 revenue of $6.7B (in line with the number given in their warning) and non-GAAP EPS of $0.50.
The FQ3 revenue consensus stands at $6.91B, though it’s possible (given Nvidia’s warning) that informal expectations are lower.
3:51 PM ET: Hi, this is Eric Jhonsa. I’ll be live-blogging Nvidia’s earnings report and call.