According to Susquehanna analyst Christopher Rowland, who has lowered his price target on the stock, his financial forecast for the first quarter could not rise significantly or earn more than expected due to weakness in his gaming-chip business.
Roland said the resumption of the economy, giving people more entertainment options, has led to a slowdown in the videogame-chip business. He said in a research note on Wednesday that the markup on the proposed retail price
Cards have fallen from more than 130% in mid-2021 to over 78% in January and now above 23%.
Nvidia declined to comment on the performance of its gaming segment or provide any guidance. Companies usually do not discuss their performance in the days leading up to their earnings report.
The analyst maintained a positive rating on the stock but lowered its target price from $ 320 to $ 280. NVDA (Ticker: NVDA) was down 2% at 8 178.25 in pre-market trading on Wednesday.
The gaming department’s outlook is less clear as business and the economy begin to recover, Roland said. This “presents a potential mid-term descriptive risk that could go into the quarter,” he wrote.
To be sure, analysts expect strong results for the Nvidia data-center segment, which he believes has outperformed gaming. Healthy underlying demand for Nvidia products is being driven by hyperscale cloud computing and artificial intelligence workloads, he said.
Nvidia reported first-quarter financial results, which ended in April, after the market closed on May 25. For its fourth quarter, the chip maker reported consistent earnings of $ 1.32 per share, up 69% from a year earlier, and revenue of 64 7.64 billion, up 53%. Nvidia’s gaming revenue rose 37% to $ 3.42 billion in the January quarter, while data-center revenue grew 71% to $ 3.26 billion.
Write karishma banjani at [email protected]