Nvidia is poised to release its fourth-quarter earnings report on Wednesday after the bell, capturing the attention of investors and analysts alike. The semiconductor giant is expected to announce revenue figures reaching $38.04 billion, alongside an adjusted earnings per share (EPS) of $0.84. Nvidia's stock has experienced a remarkable surge, rising over 440% in the past two years, and its market capitalization has surpassed $3 trillion at times.
The company's growth trajectory has been fueled by burgeoning demand for its data center graphics processing units (GPUs). Analysts predict a 72% increase in revenue for the quarter ending in January, with expectations that sales will more than double for the full fiscal year, approaching nearly $130 billion. Nvidia's impressive upward trend continues despite challenges, including restrictions on shipping its most advanced AI chips to China. To navigate these limitations, Nvidia has devised specially limited versions of its chips specifically for the Chinese market.
Market analysts and industry insiders are closely monitoring key partnerships and spending commitments from tech giants such as Microsoft, Google, Oracle, and Amazon. Microsoft is projected to account for nearly 35% of spending on Blackwell in 2025. Google follows closely, with an expected 32.2% share of spending on Blackwell in the same year. Oracle and Amazon are expected to contribute 7.4% and 6.2%, respectively.
Joseph Moore, a Morgan Stanley analyst, commented on the situation:
"We have talked to industry participants over the weekend, and while it's certainly possible that there are longer lead time changes relating to land, the Microsoft GPU demand has not changed." – Joseph Moore, Morgan Stanley analyst.
The overall capital expenditure plans of major companies like Alphabet, Meta, and Amazon further underscore the growing appetite for advanced technology infrastructure. Alphabet aims to allocate $75 billion in capital expenditures this year, while Meta plans to spend as much as $65 billion. Amazon is targeting an expenditure of $100 billion.
Nvidia's strategic adaptations and market positioning have placed it at the forefront of the semiconductor industry. The company's ability to develop tailored solutions for specific markets like China demonstrates its resilience in navigating complex geopolitical landscapes.