Nvidia is headquartered in Santa Clara, California.
Justin Sullivan | Getty Images
Semiconductor-related stocks in Asia mostly fell on Thursday after Nvidia’s profit forecast failed to meet some investors’ lofty expectations.
Although Nvidia’s Third quarter results It beat analysts’ expectations and gave a strong forecast for the current quarter, but its shares still fell 2.5% in after-hours trading to about $142.20 per share.
“No matter how well a company does…if the guidance is below the whisper high end, you may see some selling pressure,” Futurum Group CEO Daniel Newman told CNBC’s “Squawk Box Asia” following the report.
The sentiment has spread to Asia, with stocks linked to Nvidia suppliers and other chip companies mostly falling.
Asian sell-off
Semiconductor test equipment supplier Advant testNvidia, one of its customers, saw its shares fall 5.6% on Thursday, the biggest decliner in Japan’s benchmark Nikkei 225 index.
Advantest
Japanese technology group SoftBank Group Corp., which owns a stake in chip design company Arm, which supplies circuit designs called architectures to Nvidia, fell more than 1.5%.
British SemiconductorNvidia, the maker of high-performance graphics processors, fell 1.5%.
Taiwan Hon Hai Precision IndustryShares of the company, known internationally as Foxconn, fell 1.9%.
The company has been a major supplier to Nvidia and is building the world’s leading Mexico’s largest manufacturing plant Used to assemble Nvidia’s GB200 super chip, which is a key component of its next-generation Blackwell series of computing platforms.
In South Korea, SK Hynix opened higher before falling about 2%. It provides high-bandwidth memory chips for Nvidia’s artificial intelligence applications.
Samsung Electronics bucked the trend and rose 0.9%. It turned out to be Reportedly in the process of obtaining certification Supplies its advanced HBM chips to Nvidia.
conservative guidance
In the quarter ended October 27, Nvidia’s revenue increased 94% year-on-year to $35.08 billion, exceeding analysts’ expectations of $33.16 billion. However, this marked a sequential slowdown from sales growth of 122%, 262% and 265% in the previous three quarters, respectively.
Net profit for the quarter increased 109% from the same period last year to $19.3 billion.
The leading artificial intelligence chip maker said it expects revenue for the current quarter to be about $37.5 billion, plus or minus 2%. The forecast, while exceeding LSEG analysts’ expectations of $37.08 billion, would imply year-over-year growth of about 70%, a sharp slowdown from the 265% annual growth rate in the same period last year.
“Growth is slowing, even though it’s phenomenal,” said Anwiti Bahuguna, chief investment officer of global asset allocation at Northern Trust Asset Management.
She noted that a strong U.S. earnings season has boosted investor expectations to some extent.
As a major beneficiary of the artificial intelligence boom, Nvidia has dazzled Wall Street. Many of its largest customers, such as Microsoft, Alphabet, Amazon and Meta Platform, pledged in their respective earnings reports that Increase investment expenditures related to artificial intelligence in the next year.
“None of these companies will be left behind in AI technology, which puts Nvidia in a very good position,” Newman added.
Nvidia’s stock price has almost tripled this year, making it the world’s most valuable listed company.
About The Author
