Earnings Preview | NVIDIA Q1 Earnings Report is Coming! Revenue, Profit Expected to Hit New Highs

According to the Zhitong Finance and Economics APP, artificial intelligence chip giant NVIDIA (NVDA.US) will announce its financial report for the first quarter of the fiscal year 2025 after the US stock market closes on May 22 (Wednesday). The market generally expects NVIDIA's Q1 revenue to be $24.487 billion, a year-on-year increase of 240.47%; earnings per share to be $5.18, a year-on-year increase of 532.28%. Such performance means that the company will achieve record revenue and profit for the fourth consecutive quarter. At the same time, the market also expects NVIDIA's second-quarter performance guidance to show a nearly 100% year-on-year revenue growth and over 120% profit growth.

Investors will focus on NVIDIA's data center revenue. This rapidly growing business achieved a record revenue of $18.4 billion in the fourth quarter of the fiscal year 2024, more than five times the previous record, and the market currently expects NVIDIA's first-quarter data center business revenue to reach a new high of $21.7 billion.

NVIDIA CEO Jensen Huang is clearly not satisfied with his company being just a hardware supplier. His envisioned business model includes providing the best artificial intelligence chips, as well as top-notch networking suites and software. This model will enable NVIDIA to leverage its dominant position in chip products while retaining customers throughout extended product cycles.

However, NVIDIA's path forward is certainly not without challenges. Chip manufacturers like AMD (AMD.US) and Intel (INTC.US) are eyeing NVIDIA closely, while major cloud computing providers like Amazon (AMZN.US) and Alphabet (GOOGL.US) are developing their own artificial intelligence chips, which could disrupt NVIDIA's dominant position in its ecosystem.

Further complicating the challenges NVIDIA faces is the potential for supply chain disruptions. NVIDIA's main chip manufacturer, TSMC (TSM.US), recently announced production capacity constraints, which could limit NVIDIA's ability to meet market demand in the near future.

NVIDIA's stock price has surged by over 95% so far this year, and investor sentiment remains optimistic. Data shows that out of 42 analysts surveyed in the past three months, 40 rated NVIDIA as a "strong buy," while the remaining two recommended "hold."

From a technical perspective, NVIDIA's stock price has rebounded by over 20% from the bottom on April 19 ($760), approaching its historical high. Some investors have taken profits, keeping the stock price around $930. If NVIDIA's stock price breaks through $958, it will effectively open the door for the stock price to return to above $970, even breaking through the important psychological barrier of $1000. On the other hand, if NVIDIA's stock price further declines, the 5-day moving average will provide support around $920. In this case, the main test for NVIDIA's upward momentum will focus on the uptrend line established from all the lows since mid-AprilIn addition, considering the impact of NVIDIA's stock on other potential artificial intelligence companies and the entire market, everyone is watching whether the company's performance can once again live up to expectations. Steve Sosnick, Chief Strategist at Interactive Brokers, said, "If NVIDIA can continue to maintain impressive performance and raise performance guidance, it means that artificial intelligence trading can and will develop rapidly. However, if even the slightest signs of weakness appear, the impact will be far more than just NVIDIA's stock."