Nvidia stock hits all-time high, anticipating stellar earnings

Nvidia's stock hits an all-time high before announcing Q3 earnings. The AI chip maker is expected to triple its revenue.

Nvidia, the world's most valuable chip maker, has reached a record high in stock value of $504.09, just before announcing its highly anticipated Q3 earnings. The company, worth nearly $800 billion, is expected to see a revenue of about $16 billion for the third quarter, nearly triple its earnings from the same period in 2022.

The demand for Nvidia's AI chips has surged as tech companies rush to deploy generative artificial intelligence. Nvidia is in a prime position to benefit from this trend, as its AI chips are among the most advanced in the industry. The company has been working to boost its supply of graphics processing units (GPUs) and networking equipment to solidify its position as the top supplier of AI chips in the world.

Nvidia's smaller competitors are struggling to attract investment, but big tech giants like Intel, AMD, Google, and Microsoft are increasing their investments in next-gen AI chips. Google has even claimed that its AI supercomputer is faster and more environmentally friendly than Nvidia's A100 chip. Microsoft has also announced its own AI chip challenger to Nvidia, which could reduce its reliance on the company.

Geopolitical tensions, such as US-China trade disputes and export restrictions, could pose challenges for Nvidia's business, especially in the Chinese and Middle Eastern markets. Double ordering and inflated sales projections are also a concern for the company, as widespread double ordering could undermine future sales, especially in the event of a significant downturn or negative shock.

Nvidia is expecting its revenue to grow by 170% year-over-year in the quarter ended on September 30. The company has set a target of 1.5-2 million shipments of its sought-after H100 processor in 2024, compared to 500,000 this year. With the increasing demand for AI chips and the company's strong position in the market, Nvidia is poised for continued success in the future.