Nvidia Bounces Back
The big story from US earnings yesterday was the better than forecast results from tech group Nvidia. Rebounding from the prior quarter’s losses, the group posted Q4 EPS of $0.88 vs $0.81 expected on revenues of $6.051 billion vs $6.015 billion expected. Worth noting that year-on-year both EPS and revenues were lower. However, along with quarter-on-quarter uptick, investors appeared buoyed by the group’s more optimistic 2023 outlook when compared with some of the gloomier forecasts we’ve heard across this earnings season.
AI Demand Growth
The big driver behind Nvidia’s quarterly growth was the success in it’s data centre business, fuelled by a rise in chip sales for AI. Nvidia’s position as a leading producer of graphics cards has helped it capitalise on this new growth area. Looking ahead, the group was optimistic about its chances of continued growth linked to surging demand from AI interest. With businesses of all sizes reportedly feeling an urgency to invest in AI capabilities, Nvidia is well positioned to ride the wave via its chip sales and cloud businesses. For Q1, the company forecast revenues of $6.5 billion, topping Wall Street’s own $6.35 billion forecasts.
Technical Views
Nvidia
The rally off last year’s lows has seen the stock breaking out above the bear trend line from 2022 highs and more recently, above the 193.10 level resistance. This is a key pivot for the stock and while above here the focus is on a further move higher towards the 285.60. Should price slip back below the level, the next support will be the rising trend line off Q3 2022 lows.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.