NVIDIA Corporation (NVDA - Free Report) is slated to release third-quarter fiscal 2023 results on Nov 16.
For the fiscal third quarter, the company expects revenues of $5.9 billion (+/-2%). The Zacks Consensus Estimate for the same is pegged at $5.99 billion, indicating a 15.7% decline from the year-ago reported figure.
The Zacks Consensus Estimate for quarterly earnings is pegged at 73 cents per share, suggesting a year-over-year decline of 37.6%.
The company’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while missing the same on one occasion, the average surprise being 2.3%.
Let’s see how things have shaped up before the announcement.
Factors to Consider
NVIDIA’s third-quarter performance is likely to have been negatively impacted by the weakening demand for its chips used in the gaming end market. The company’s revenues from the Gaming market platform plunged 33% year over year and 44% sequentially in the last reported quarter. The decline was primarily due to a lower sell-in of Gaming products, reflecting reduced channel partner sales due to macroeconomic headwinds.
We believe that the trend is likely to have continued in the third quarter. The Zacks Consensus Estimate for the Gaming segment’s revenues is pegged at $1.4 billion, indicating a 56.6% decline from the year-ago quarter’s revenues of $3.22 billion.
In its second-quarter results, NVDA stated that revenues from Professional Visualization would decline sequentially in the third quarter. In the last reported quarter, the segment’s revenues plunged 4% year over year and 20% sequentially due to lower sales of desktop workstation graphic processing units (GPUs), which more than offset the benefits of an increase in mobile revenues.
We opine that the ongoing macroeconomic headwinds are likely to have continued to hurt the sales of NVIDIA’s desktop workstation GPUs in the third quarter. The consensus mark of $368 million for the company’s Professional Visualization division’s revenues suggests a decline of 36.2% year over year and 25.8% sequentially.
However, disruptions in retail channel sales due to travel restrictions and social-distancing measures implemented across several parts of China might have weighed on the overall financial performance in the fiscal third quarter. Also, the ongoing supply-chain constraints and the Russia-Ukraine war are likely to have been a concern.
However, the continued strength in its Datacenter business on the growing adoption of cloud-based solutions amid the growing hybrid working trend is expected to have boosted NVDA’s third-quarter revenues. An increase in the Hyperscale demand and the growing adoption in the inference market are likely to have been tailwinds in the to-be-reported quarter.
However, the ongoing supply-chain disruptions are likely to have hurt the division’s top line. The Zacks Consensus Estimate for the Datacenter segment’s revenues is pegged at $3.91 billion, suggesting an improvement of 33.2% year over year and 2.7% sequentially.
The company’s Automotive segment showed an improvement in trends in four of the last five quarters. The positive trend is likely to have continued in the fiscal third quarter, mainly due to increasing investments in self-driving and artificial intelligence cockpit solutions.
The consensus mark for the Automotive division’s top line is pegged at $239 million. This indicates growth of 77% year over year and 8.6% sequentially.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for NVIDIA this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.
Though NVIDIA currently carries a Zacks Rank of #3, it has an Earnings ESP of -9.68%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Per our model, Salesforce (CRM - Free Report) , Cisco (CSCO - Free Report) and Analog Devices (ADI - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.
Salesforce is slated to report third-quarter fiscal 2023 results on Nov 30. The company carries a Zacks Rank #3 and an Earnings ESP of +7.13% at present. CRM's earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 18.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Salesforce’s quarterly earnings is pegged at $1.21 per share, suggesting a year-over-year decline of 4.7%. Its quarterly revenues are estimated to increase 13.8% year over year to $7.81 billion.
Cisco carries a Zacks Rank #3 and an Earnings ESP of +1.46%. The company is slated to report first-quarter fiscal 2023 results on Nov 16. CSCO's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 1.8%.
For the first quarter, the Zacks Consensus Estimate for Cisco’s earnings is pegged at 84 cents per share, indicating a 2.4% year-over-year increase. Revenues are expected to grow 3.3% to $13.32 billion.
Analog Devices carries a Zacks Rank #3 and has an Earnings ESP of +1.10. The company will report its fourth-quarter fiscal 2022 results on Nov 22. Its earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 6.9%.
The Zacks Consensus Estimate for Analog Devices’ fourth-quarter earnings stands at $2.58 per share, suggesting a whopping year-over-year increase of 49.1%. Revenues are estimated to grow 35.2% year over year to $3.16 billion.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s an American AI company that’s riding low right now, but it has rounded up clients like BMW, GE, Dell Computer, and Bosch. It has prospects for not just doubling but quadrupling in the year to come. Of course, all our picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock And 4 Runners Up
NVIDIA Corporation (NVDA - Free Report) is slated to release third-quarter fiscal 2023 results on Nov 16.
For the fiscal third quarter, the company expects revenues of $5.9 billion (+/-2%). The Zacks Consensus Estimate for the same is pegged at $5.99 billion, indicating a 15.7% decline from the year-ago reported figure.
The Zacks Consensus Estimate for quarterly earnings is pegged at 73 cents per share, suggesting a year-over-year decline of 37.6%.
The company’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while missing the same on one occasion, the average surprise being 2.3%.
Let’s see how things have shaped up before the announcement.
Factors to Consider
NVIDIA’s third-quarter performance is likely to have been negatively impacted by the weakening demand for its chips used in the gaming end market. The company’s revenues from the Gaming market platform plunged 33% year over year and 44% sequentially in the last reported quarter. The decline was primarily due to a lower sell-in of Gaming products, reflecting reduced channel partner sales due to macroeconomic headwinds.
We believe that the trend is likely to have continued in the third quarter. The Zacks Consensus Estimate for the Gaming segment’s revenues is pegged at $1.4 billion, indicating a 56.6% decline from the year-ago quarter’s revenues of $3.22 billion.
In its second-quarter results, NVDA stated that revenues from Professional Visualization would decline sequentially in the third quarter. In the last reported quarter, the segment’s revenues plunged 4% year over year and 20% sequentially due to lower sales of desktop workstation graphic processing units (GPUs), which more than offset the benefits of an increase in mobile revenues.
We opine that the ongoing macroeconomic headwinds are likely to have continued to hurt the sales of NVIDIA’s desktop workstation GPUs in the third quarter. The consensus mark of $368 million for the company’s Professional Visualization division’s revenues suggests a decline of 36.2% year over year and 25.8% sequentially.
However, disruptions in retail channel sales due to travel restrictions and social-distancing measures implemented across several parts of China might have weighed on the overall financial performance in the fiscal third quarter. Also, the ongoing supply-chain constraints and the Russia-Ukraine war are likely to have been a concern.
However, the continued strength in its Datacenter business on the growing adoption of cloud-based solutions amid the growing hybrid working trend is expected to have boosted NVDA’s third-quarter revenues. An increase in the Hyperscale demand and the growing adoption in the inference market are likely to have been tailwinds in the to-be-reported quarter.
However, the ongoing supply-chain disruptions are likely to have hurt the division’s top line. The Zacks Consensus Estimate for the Datacenter segment’s revenues is pegged at $3.91 billion, suggesting an improvement of 33.2% year over year and 2.7% sequentially.
The company’s Automotive segment showed an improvement in trends in four of the last five quarters. The positive trend is likely to have continued in the fiscal third quarter, mainly due to increasing investments in self-driving and artificial intelligence cockpit solutions.
The consensus mark for the Automotive division’s top line is pegged at $239 million. This indicates growth of 77% year over year and 8.6% sequentially.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for NVIDIA this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.
Though NVIDIA currently carries a Zacks Rank of #3, it has an Earnings ESP of -9.68%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Per our model, Salesforce (CRM - Free Report) , Cisco (CSCO - Free Report) and Analog Devices (ADI - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.
Salesforce is slated to report third-quarter fiscal 2023 results on Nov 30. The company carries a Zacks Rank #3 and an Earnings ESP of +7.13% at present. CRM's earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 18.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Salesforce’s quarterly earnings is pegged at $1.21 per share, suggesting a year-over-year decline of 4.7%. Its quarterly revenues are estimated to increase 13.8% year over year to $7.81 billion.
Cisco carries a Zacks Rank #3 and an Earnings ESP of +1.46%. The company is slated to report first-quarter fiscal 2023 results on Nov 16. CSCO's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 1.8%.
For the first quarter, the Zacks Consensus Estimate for Cisco’s earnings is pegged at 84 cents per share, indicating a 2.4% year-over-year increase. Revenues are expected to grow 3.3% to $13.32 billion.
Analog Devices carries a Zacks Rank #3 and has an Earnings ESP of +1.10. The company will report its fourth-quarter fiscal 2022 results on Nov 22. Its earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 6.9%.
The Zacks Consensus Estimate for Analog Devices’ fourth-quarter earnings stands at $2.58 per share, suggesting a whopping year-over-year increase of 49.1%. Revenues are estimated to grow 35.2% year over year to $3.16 billion.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s an American AI company that’s riding low right now, but it has rounded up clients like BMW, GE, Dell Computer, and Bosch. It has prospects for not just doubling but quadrupling in the year to come. Of course, all our picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock And 4 Runners Up
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