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Is a big move coming for AMD?

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Nvidia’s stock surges past $1,000 on strong Q1

Thursday, May 23, 2024

Today’s headlines

What’s happening: Shares of Nvidia Corporation spiked in after-hours trading on Wednesday, following the release of the company’s first-quarter results.

What happened: The semiconductor chipmaker reported stronger-than-expected results for the quarter, which sent its stock to a record high during the extended trading hours.

Nvidia disclosed a 10-for-1 stock split and announced a steep increase in its quarterly dividend.

How were the results: The Santa Clara, California-based company reported a sharp increase in both sales and earnings for the first quarter ended April 28.

  • Revenues grew by 262% year-over-year to $26.04 billion, topping consensus estimates of $24.64 billion.
  • Earnings surged 461% to $6.12 per share, surpassing Wall Street expectations of $5.59 per share.

Why it matters: Rising investments by companies in artificial intelligence have been providing a boost to Nvidia. Large companies and cloud network operators have continued to keep their spend elevated on chips developed by Nvidia.

The company’s adjusted gross margin came in at 78.9% in the first quarter, exceeding market estimates of 77%. Sales at its data center division, the largest in terms of revenue, surged 427% to $22.6 billion, also topping market views of $21.32 billion.

Gaming revenue grew by 18% year-over-year to $2.6 billion, while automotive sales increased 11% to $329 million in the quarter. Professional visualisation sales came in at $427 million, up 45% from the previous year.

“The next industrial revolution has begun — companies and countries are partnering with Nvidia to shift the trillion-dollar traditional data centers to accelerated computing and build a new type of data center — AI factories — to produce a new commodity: artificial intelligence,” CEO Jensen Huang said.

Nvidia hiked its quarterly dividend by 150% to 10 cents per share, which will be payable on June 28 to shareholders on record as of June 11. The company will split its stock 10-for-1, effective June 7.

For the second quarter, management guided to revenues of $28 billion, plus or minus 2%, and non-GAAP gross margin of 75.5%, plus or minus 50 basis points.

How shares responded: Nvidia’s shares gained 6.1% to $1,007.00 in extended trading, following the release of quarterly results on Wednesday. The stock has added a whopping 97% year-to-date.

What to watch: Investors will continue monitoring demand for AI chips, amid growing AI investments by large enterprises.

The markets today

The British pound will be in focus today ahead of a basket of economic data

Context: The GBP/USD forex pair gained on Wednesday, as investors assessed inflation data from the UK.

Details: Data released on Wednesday showed UK’s inflation rate moving closer to the Bank of England’s target. However, the easing in the inflation rate was not as much as projected, which sparked speculations of interest rate cuts by the BoE in June.

The Office for National Statistics said that UK’s annual inflation rate eased to 2.3% in April, from 3.2% in March. The figure came in higher than market estimates of 2.1%. Core inflation eased for a third month in a row to 3.9% in April but came in higher than market expectations of 3.6%.

UK producer prices rose 1.1% year-over-year in April, versus a 0.7% increase in the prior month. This was better than market estimates of a 1.2% gain. Public sector net borrowing, excluding public sector banks, rose to £20.5 billion in April, from £19.0 billion in the year-ago period.

Some strength in the US dollar limited the overall gains for the GBP/USD forex pair. The US dollar index, which measures the greenback’s performance versus a basket of major peers, gained around 0.3% to 104.93 on Wednesday.

The GBP/USD rose slightly to 1.2716 on Wednesday, after hitting a fresh two-month high of $1.27520 earlier in the session. The EUR/GBP forex pair fell around 0.4% to 0.8511.

London’s FTSE 100 declined 0.55% to close at 8,370.33 on Wednesday, while the domestically oriented FTSE 250 dipped 0.35% to settle at 20,710.07.

What to watch: Investors await the release of economic reports on composite PMI, manufacturing PMI and services PMI from the UK today. The S&P Global manufacturing PMI, which came in at 49.1 in April, is expected to improve to 49.5 in May. Analysts expect the services PMI to decline to 54.7 in May, from 55 in April.

Other Markets: US trading indices closed lower on Wednesday, with the Dow Jones index, S&P 500 and Nasdaq 100 down by 0.51%, 0.27% and 0.05%, respectively.

The news shaping the markets

The Swedish government agreed to provide further military support worth 75 billion crowns ($7.01 billion) to Ukraine over three years. The news sent the RUB/USD pair lower in forex trading this morning.


The Bank of Korea kept its base rate unchanged at 3.5% at its latest meeting. Although the move was widely expected, it lent support to the KRW/USD forex pair.


Australia’s consumer inflation expectations eased to 4.1% in May, versus 4.6% in the prior month. This signalled the lowest rate since October 2021 and sent the AUD/USD pair higher in forex trading this morning.


Singapore’s current account surplus widened to S$37.19 billion in the first quarter, from S$31.98 billion in the year-ago period. The country recording the largest current account surplus since the series started in 1986 lent support to the SGD/USD forex pair.


Japan’s au Jibun Bank composite PMI rose to 52.4 in May, from 52.3 a month ago. The recent reading being the strongest since last August sent the JPY/USD pair higher in forex trading this morning.

What else to watch today

Turkey’s consumer confidence indicator, foreign exchange reserves and interest-rate decision, France’s composite PMI, manufacturing PMI and services PMI, Germany’s composite PMI, manufacturing PMI and services PMI, Eurozone’s composite PMI, manufacturing PMI, services PMI, negotiated wage growth and consumer confidence indicator, Mexico’s GDP Growth rate, overall index of economic activity, consumer prices and monetary policy meeting minutes, Canada’s new housing price index, US Chicago Fed National Activity Index, Initial jobless claims, continuing jobless claims, composite PMI, manufacturing PMI, services PMI, New home sales, natural gas stocks change, Kansas Fed composite index, Kansas City Fed’s manufacturing production index and building permits, China’s foreign direct investment, as well as Argentina’s retail sales.


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