Nvidia (NASDAQ: NVDA) is a $2.6 trillion company and currently represents 5.8% of the world’s value. S&P 500 As of June, Nvidia shares were up 150% year-to-date, accounting for a third of the S&P 500’s total return.
Nvidia and the index have been down since mid-July, but a seismic event is coming on August 28 that could reverse their fortunes. That’s when Nvidia reports its financial results for the second quarter of fiscal 2025 (ending July 31), and if past quarters are any indication, it could be a real bust.
Nvidia designs the most powerful data center chips for processing artificial intelligence (AI) workloads, and demand from some of the world’s largest tech giants continues to outstrip supply. As a result, investors are eagerly awaiting the company’s latest sales results; here’s how I predict Nvidia’s stock will react following their release.
Nvidia Dominates AI Data Center Chip Market
Nvidia’s graphics processors (GPUs) for data centers are the gold standard for AI development. GPUs are designed for parallel processing, meaning they can perform multiple tasks simultaneously. They can handle high throughput and typically have a significant amount of onboard memory, making them ideal for processing large volumes of data. This is essential when it comes to training AI models and performing AI inference.
According to many Wall Street forecasts, AI applications could drive a productivity boom across the global economy, worth trillions of dollars, over the next decade. data center operators Companies are replacing much of their traditional CPU-based infrastructure with GPUs to meet the demand from AI developers. Nvidia’s flagship H100 GPU has been the go-to choice since last year, but the company is working to beat its own performance benchmarks.
Nvidia’s new H200 can perform AI inference at nearly twice the speed of the H100 while consuming half the power. Then there’s the GB200, which is based on Nvidia’s new Blackwell architecture, and could perform AI inference at 5 times the speed of the H100. Blackwell-based chips will begin shipping to customers at scale in 2025.
Nvidia has a tight grip on the data center GPU market, with its market share projected to reach 98% in 2023, although it will decline this year due to viable competition from other chipmakers like Advanced Micro Devicesdemand is expected to continue to outstrip supply.
Here’s What Wall Street Expects From Nvidia’s Next Quarterly Report
Nvidia generated record revenue of $26 billion in the first quarter of fiscal 2025 (ended April 28), a 262% increase from the same period a year earlier. It beat Wall Street’s forecast of $24.6 billion. The result includes $22.6 billion in revenue from data centers alone, representing 427% growth driven by strong demand for GPUs.
Nvidia too…
