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Nvidia shares rose Tuesday as investors braced for the AI ​​leader’s quarterly earnings results due later this week; This report is described as the most important upcoming event for the hot but turbulent stock market.

Basic Information

Surprising Fact

Options traders are pricing in higher risk of a move for the benchmark S&P 500 index on Friday compared to trading sessions that follow the typically important economic updates of November employment and consumer price index inflation reports and December’s Fed interest rate meeting, according to the Bank of America panel. . Nvidia accounts for more than 7% of the market cap-weighted S&P.

Nvidia Earnings Preview

Wall Street is expecting another boom quarter for Nvidia. Consensus analysts’ estimates call for record earnings of $0.75 per share ($17.4 billion in net income) and $33.2 billion in revenue for the three months ending in October, according to FactSet. This represents the sixth consecutive quarter in which Nvidia has set new records for all three metrics. Forecasts call for Nvidia to grow more than 80% year-over-year in revenue and profits in the third quarter; That’s well above the sub-20% annual revenue and profit growth achieved by the world’s other $3 trillion companies in the third quarter. , Apple and Microsoft.

Key Background

Nvidia this most valuable It is the most publicly traded company in the world by market capitalization, with a valuation of $3.65 trillion, surpassing Apple’s $3.45 trillion and Microsoft’s $3.11 trillion. Nvidia is almost a 80% market share In AI accelerators, the hugely expensive processing equipment required to train trendy generative AI models developed by organizations from Amazon to Earth danish government. The company’s financial performance and valuation have skyrocketed during the recent generative AI revolution. Its split-adjusted share price has risen nearly 850% over the past two years, taking its market cap from less than $400 billion to near $4 trillion, while its estimated net income of $67.9 billion this fiscal year is expected to be more than $1,400 billion. % improvement from $4.4 billion for the year covering most of 2022.

Forbes Valuation

We estimate Nvidia CEO Jensen Huang’s net worth to be: approximately 128 billion dollars As of Tuesday afternoon ninth richest person in the world.

CORRECTION (11/19): This story has been updated to reflect the date of Nvidia’s earnings report.

Additional Reading

ForbesNvidia’s New Hardware Alleviates Concerns About Blackwell SwitchingWith Karl Freud

ForbesBofA Says Nvidia Could Approach $5 Trillion Valuation While ‘Generation’ AI Opportunity Still AheadWith Derek Saul