Nvidia Corporation (Nasdaq: NVDA) reported record earnings and revenue in its fiscal 2019 first quarter, but NVDA stock trading lower on Friday morning as investors took profits from Nvidia’s incredible pre-earnings run.
Despite the potential for volatility, analysts say Nvidia remains extremely well-positioned for the long term.
Nvidia reported first-quarter earnings per share of $1.98 on revenue of $3.21 billion. Both numbers beat consensus analyst forecasts of $1.46 and $2.89 billion, respectively. Revenue was up 66 percent from a year ago.
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Nvidia gaming revenue was up 68 percent to $1.72 billion, beating analyst estimates of $1.61 billion. Data Center revenue was up 71 percent to $701 million, ahead of analyst estimates of $656 million. Professional Visualization revenue was up 22 percent to $251 million, topping expectations of $248 million. Even Automotive revenue was up 4 percent to $145 million, ahead of consensus estimates of $140 million.
Nvidia reported first-quarter GAAP gross margin of 64.5 percent, up 2.6 percent from the fourth quarter and up 5.1 percent from a year ago.
“Our data center business achieved another record and gaming remained strong,” CEO Jensen Huang says in a statement. “At the heart of our opportunity is the incredible growth of computing demand of [artificial intelligence], just as traditional computing has slowed.”
Looking ahead, Nvidia guided for second-quarter revenue of $3.1 billion, ahead of consensus estimates of $2.95 billion. Nvidia also expects second-quarter GAAP gross margin to contract to 63.3 percent.
Nvidia’ incredible run has continued so far in 2018, with the stock up 23 percent year-to-date to new all-time highs. Nvidia shares are now up more than 1,100 percent in just the past three years. NVDA stock initially traded lower by more than 2 percent on Friday morning following the record quarter, suggesting some investors may finally be taking profits on their big gains.
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Investing.com analyst Haris Anwar says he has no doubt about Nvidia’s long-term outlook.
“It’s much better than most of its peers, and there’s no threat to the company’s main revenue generating units,” Anwar says. “Investors would be smart to stick with Nvidia. Their momentum is unlikely to fade any time soon.”
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Nvidia Corporation (NVDA) Investors Take Profits After Record Quarter originally appeared on usnews.com
