Lukewarm Results Expected At NVIDIA Despite Strong Demand And Continued Market Share Gains

Shares of NVIDIA Corporation NVDA are rising slightly on Thursday, as the company prepares to announce its first quarter financial results after the market closes.

According to Estimize, experts and the crowd both expect to see some year-over-year growth in earnings, but a huge decline in relation to last quarter.

For the first quarter last year, the company reported earnings of $0.24 on revenue of $1.103 billion. Last quarter, earnings came in at $0.43 per share on revenue of $1.251 billion.

For the first quarter of the current year, the Street projects consensus earnings of $0.26 per share on revenue of $1.162 billion, while the crowd anticipates earnings of $0.31 per share on revenue of $1.179 billion.

The chart above shows how NVIDIA’s actual earnings have compared to estimates over the past couple of years. As it can be seen, the company has comfortably beat projections for the past five quarters.

A second graph illustrates the evolution of sentiment since the beginning of the year. Despite experiencing some ups and downs, estimates for both experts and the crowd have surged only slightly surged since February.

Continued Market Share Gains

In a recent report, analysts at Wedbush previewed the earnings of four big semiconductor companies. They model an in-line quarter “driven by demand from PC gaming, data center and continued market share” gains. However, they anticipate guidance will come in short of expectations “due to industry-wide headwinds in the PC supply chain and ‘rapid’ changes in currencies,” a Benzinga article reads.

The analysts add, “Nvidia's ‘impressive transformation in the late innings’ will ensure shares trade near its 52-week highs until the ITC will hear its patent infringement claims against QUALCOMM and Samsung Electronics.”

Wedbush maintains an Outperform rating and a $25 price target on NVIDIA’s stock.