Earnings To Watch: Nvidia (NVDA) Reports Q2 Results Tomorrow

Kayode Omotosho /
2023/08/22 8:57 am EDT

Leading designer of graphics chips Nvidia (NASDAQ:NVDA) will be announcing earnings results tomorrow after market hours. Here's what investors should know.

Last quarter Nvidia reported revenues of $7.19 billion, down 13.2% year on year, beating analyst revenue expectations by 10.3%. It was a very strong quarter for the company, with a significant improvement in its inventory levels and an impressive beat of analysts' EPS estimates.

Is Nvidia buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Nvidia's revenue to grow 65.1% year on year to $11.1 billion, improving on the 3.03% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $2.09 per share.

Nvidia Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 3.12%.

Looking at Nvidia's peers in the processors and graphics chips segment, some of them have already reported Q2 earnings results, giving us a hint of what we can expect. Intel's revenues decreased 15.5% year on year, beating analyst estimates by 6.69% and Qualcomm reported revenue decline of 22.7% year on year, missing analyst estimates by 0.66%. Intel traded up 6.1% on the results, and Qualcomm was down 3.3%.

Read our full analysis of Intel's results here and Qualcomm's results here.

Tech stocks have been facing declining investor sentiment since 2022 and while some of the processors and graphics chips stocks have fared somewhat better, they have not been spared, with share price declining 4.78% over the last month. Nvidia is up 7.14% during the same time, and is heading into the earnings with analysts' average price target of $530.9, compared to share price of $478.5.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.