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What’s happening: Shares of Nvidia Corporation fell in after-hours trading on Wednesday, following the release of the company’s third-quarter results.
What happened: The AI giant reported better-than-expected sales and earnings for the latest quarter.
Although Nvidia more than doubled its earnings, management guiding to the slowest growth in sales in seven quarters weighed on the stock.
How were the results: The Santa Clara, California-based company reported high double-digit growth in sales in the quarter ended October 27.
Why it matters: Nvidia continued its streak of topping market estimates in the latest quarter. The company has managed to outperform sales estimates for nine consecutive quarters, while also beating earnings expectations for eight quarters in a row.
Nvidia’s earnings surged to $19.31 billion in the third quarter, more than double the $9.24 billion reported in the year-ago period.
The company’s datacentre business generated record revenues in the latest quarter, with revenue surging 112% year-over-year to $30.77 billion. The division had notched 154% growth in the previous quarter.
Nvidia said its adjusted gross margins contracted to 75%. The company said its much-awaited Blackwell family of AI chips is now “in full production” and expects shipments to commence in the fourth quarter of 2025. These are expected to negatively impact gross margins initially, with an improvement over time.
“The age of AI is in full steam, propelling a global shift to Nvidia computing,” CEO Jensen Huang said.
Management guided to revenues of $37.5 billion plus or minus 2% for the fourth quarter, slightly higher than market estimates of $37.09 billion. Although the latest forecast represents strong growth of around 69.5% amid upbeat demand for its chips, it marks a slowdown from the 94% growth generated in the third quarter.
How shares responded: Nvidia’s shares fell 2.5% to close at $142.25 in extended trading on Wednesday, following the release of quarterly earnings. The stock has jumped around 203% year to date.
What to watch: Investors will continue monitoring the upcoming launch of the Blackwell family of chips and growing investments in AI by companies.
Context: The CAD/USD forex pair fell on Wednesday, amid strength in the US dollar.
Details: Investors assessed the escalation in the ongoing war between Russia and Ukraine. Updates from Moscow revealed that Ukraine had struck deep inside Russia with US-made missiles. In response, Russia released a new nuclear doctrine, which lowered the conditions under which President Vladimir Putin could order a nuclear strike.
Meanwhile, Russia’s foreign minister Sergei Lavrov emphasised the need to avoid a nuclear war.
Rising geopolitical tensions provided a boost to the safe-haven US dollar, which exerted pressure on the CAD/USD forex pair. The US dollar index, which measures the greenback’s performance versus a basket of major peers, gained more than 0.4% to 106.68 on Wednesday.
The latest data from Canada showed the annual inflation rate accelerating to 2% in October, from 1.6% in September. The figure also came in higher than the 1.9% market expectations.
Weakness in the price of crude oil, one of Canada’s major exports, also weighed on the loonie. WTO crude oil prices settled lower at $68.87 per barrel on Wednesday.
The CAD/USD forex pair fell around 0.1% to 1.3976. The S&P/TSX Composite Index gained 0.1% to close at 25,036.46 on Wednesday.
What to watch: Investors await the release of economic data on producer price inflation (1730 GST) and raw materials prices (1730 GST) from Canada today.
Industrial producer prices in Canada, which declined by 0.6% in September, are expected to increase by 0.3% in October. Analysts expect Canada’s Raw Materials Price Index to decline 1.5% in October, following a 3.1% fall in September.
Other Markets: European indices closed lower on Wednesday, with the FTSE 100, DAX 40, CAC 40 and STOXX Europe 600 Index down by 0.17%, 0.29%, 0.43% and 0.02%, respectively.
Russia has started building nuclear-resistant mobile bomb shelters, which could withstand radiation from nuclear explosions. The news sent the RUB/USD higher in forex trading this morning.
Argentina reported a trade surplus of $888 million in October, versus a year-ago deficit of $442 million. However, the latest reading missed market estimates of a surplus of $1.14 billion, exerting pressure on the ARS/USD forex pair.
Colombia’s trade deficit widened to $1.032 billion in September, from $0.816 billion in the year-ago month, which sent the COP/USD pair lower in forex trading this morning.
South Africa’s retail sales grew by 0.9% year-over-year in September, slowing from the 3.3% surge in the previous month. The latest reading signalled the seventh straight month of expansion in retail activity, lending support to the ZAR/USD forex pair.
Eurozone’s construction output fell by 1.6% year-over-year in September. This marked an improvement from the 2.5% decline recorded in the previous month, sending the EUR/USD pair higher in forex trading this morning.
South Africa’s building permits (1500 GST) and interest rate decision (1700 GST), Turkey’s foreign exchange reserves (1530 GST) and Central Bank of Turkey’s interest rate decision (1500 GST), UK’s CBI industrial trends orders (1500 GST), Mexico’s retail sales (1600 GST), US initial jobless claims (1730 GST), Philadelphia Fed manufacturing index (1730 GST), continuing jobless claims (1730 GST), existing home sales (1900 GST), CB leading index (1900 GST), EIA natural gas stocks change (1930 GST), Kansas Fed composite index (2000 GST) and Kansas Fed manufacturing index (2000 GST), Argentina’s consumer confidence (1900 GST), as well as Eurozone’s consumer confidence (1900 GST).
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