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Author: Alan LittleDate: 2021-02-26

Nvidia (NVDA) -5% after CEO downplays new crypto card push

Nvidia’s (NVDA) fiscal Q4 report featured earnings and revenue beats on Thursday, but CEO Jensen Huang’s statement that its new GPUs for cryptocurrency miners would only be a “small part” of its business sent shares 5% lower. 


Late on Wednesday, Nvidia posted $3.10 earnings per share and $5bn revenue for the three months to 31st December, versus the $2.81 and $4.82bn consensus. 


Despite a recent global semiconductor shortage, Nvidia managed to deliver a 61% spike in sales year over year as demand for its processors surged during the pandemic. 


The company’s main graphics division saw a 47% rise in revenue of $3.06bn, while its Compute and Networking division fared even better, rising 91% to $1.95bn.   


The only blot on its copybook was the automotive business, which saw an 11% decline in revenues of $145m in Q4 and was down 23% for the whole of 2020. 


Nvidia is confident of more growth in the coming months though and guided for $5.3bn revenue for Q1, which was way up on the $4.51bn forecast from analysts.  


The stage appeared to be set for share gains on Thursday, but Huang’s statement about Nvidia’s new crypto-focused GPUs appears to have weighed on investor sentiment. 


The company announced a new range of graphics cards for crypto mining on Monday, a move that was designed to free up more inventory for gamers.  


Huang revealed in an analyst call that he did not see the new cards being a core focus for the business. 


Analysts were increasing price targets though, with J.P. Morgan’s Harlan Sur pivoting from $605 to $660 on his view that Nvidia “continues to execute across all segments”. 


Nvidia shares retreated 5.56% to $547.40 at around midday ET on the Nasdaq. 






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