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A strong performance is expected in the chip maker’s gaming and data center business when it reports earnings on Wednesday.
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nvidia
It could be a big winner this earnings season, with earnings driven by strong performance in the chipmaker’s data center and gaming business, according to
Piper Sandler
.
“We look forward to a big win and an uptick when the company reports earnings on Wednesday after the market closes, as both the game and data center continue to perform well,” Kumar analyst Harsh wrote in a research note.
He said a new upgrade cycle in GPUs could drive growth in games. Kumar added that he expects a 4.3% increase qoq in the January quarter, which the company may outpace.
Although demand for games remains strong, and will continue to grow over the next few quarters, Kumar believes that Nvidia (stock ticker:
NVDA
) The data center business will increase revenue this quarter. The analyst sees data center trends accelerating in 2022, and expects growth of 7.5 percent from the previous quarter. He added that as trends accelerate, the data center business could reach double-digit growth.
“We believe the data center business will be responsible for much of the revenue performance, which translates to both EPS and revenue outperformance,” he said.
Kumar said that in his view, Nvidia is “limited in supply at this point in time,” affecting both the gaming and data center businesses. Regardless, he added, the company is in a better position to get the offer than competitors. He expects next-quarter guidance to rise sequentially, even if game sales have been historically flat during the April quarter.
The analyst reiterated Outperform’s rating and a target price of $350 per share. on Monday, Trust analysts also expressed an optimistic view For Nvidia Earnings. For the Trust team, Nvidia’s investment in AI should push management and analysts alike to increase their earnings forecasts, driving the stock price higher.
Nvidia stock rose 7.1% to $259.97 on Tuesday. The stock has lost 12.9% since the start of the year. Nvidia earlier this month She gave up trying to get the chip designer arm due to regulatory opposition.
Write to Sabrina Escobar at [email protected]
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