AI specialist on the rise
Nvidia exceeds expectations – share price rises significantly
May 22, 2024, 11:29 p.m
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Once again, Nvidia’s profit forecast exceeds that of analysts. And while the champagne corks are likely to be popping in the company, the AI specialist’s shares are making a jump. The reason for this is the high demand for AI processors.
Chip manufacturer Nvidia expects second-quarter sales of $28 billion, with a fluctuation of plus or minus two percent. The company recently announced this. The forecast is above analysts’ expectations, which on average had expected sales of $26.66 billion, according to data from LSEG.
The US company reported sales of $26.04 billion for the first quarter, which was also above analyst estimates of $24.65 billion. The specialist in semiconductors for artificial intelligence applications is thus continuing its successful course. In after-hours trading, the share price rose by around four percent. A few weeks ago, the world’s largest contract manufacturer TSMC, which also manufactures for Nvidia, spoke of “insatiable demand” for AI processors.
Other chip manufacturers want a piece of the pie
For this reason, Nvidia, which dominates the global market for these chips, had exceeded analysts’ sales expectations in each of the previous six quarters. By the end of 2023, revenues had tripled. According to experts, Nvidia controls around 80 percent of the global market for sophisticated AI specialty processors. The top model is the “Blackwell B200”, the price of which is estimated to be more than $20,000 per unit.
Other chip manufacturers such as Intel or AMD want to get a piece of this cake, but so far they have not come close to Nvidia. The same applies to other technology companies such as the iPhone provider Apple, Facebook parent Meta or the cloud operators Amazon and Microsoft.