Nvidia earnings in the spotlight

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Nvidia will report its first quarter earnings after the bell today, closing out the Q1 season for the Magnificent 7. 

With things relatively quiet (hopefully I didn’t just jinx it) on the trade war front, Nvidia’s report is poised to move markets. 

Analysts polled by FactSet are calling for Q1 revenue to come in at $43.3 billion, which would be a 66% year-over-year increase. Not too shabby — though the chipmaker’s year-over-year revenue growth was 262% in Q1 2024. 

This time around, investors will be just as interested in what Nvidia isn’t selling. 

In April, the chipmaker said it would be taking on a charge of up to $5.5 billion in the first quarter after regulatory changes rendered a portion of its inventory unsellable. Nvidia’s H20 chips — designed specifically for Chinese buyers — now require a license to sell, so the company will be eating costs associated with purchase commitments. 

NVDA futures slid 6% on April 15, when Nvidia revealed the news in a regulatory filing. Shares have since pared losses, and as of 2 p.m. ET Wednesday were trading 31% higher than their mid-April low. Still, NVDA is down 1% year to date. 

Just days ago, Nvidia CEO Jensen Huang called the restrictions on H20 chip sales to China “deeply painful” and “enormously costly.” Two phrases shareholders never want to hear. 

We’ll see what execs have to say about the Q2 forecast this evening. As always, keep an eye on your inbox for the breakdown tomorrow.

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