Nvidia's Data Center Business

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Nvidia's Data Center Business

Despite a host of problems with its financial earnings report, shares of Nvidia (Nasdaq: NVDA) ticked up by 2.20% in after-hours trading on Wednesday.

Financials: Nvidia reported earnings of 58 cents per share, which was below estimates. But its revenue of $5.93 billion was better than expected.

Game Over: Gaming revenue dropped 51% year-over-year due in part to higher inventory levels and lower demand expectations.

Surprise Hero: Nvidia was saved by its data center business. Revenue for this unit went up 31% thanks to cloud service providers and internet companies.

China Problem: The company blamed Covid lockdowns in China for its lower gaming demand. It also blamed new export restrictions for products to China.

Final Thoughts: Nvidia’s stock has lost over half of its value this year. It’s a bad time for investors to trust the gaming industry, but Nvidia is hoping to correct inventory levels in the future.

Notables

Notable Earnings Today: Alibaba Group Holding (NYSE: BABA), Palo Alto Networks (Nasdaq: PANW), Macy's (NYSE: M), Applied Materials (Nasdaq: AMAT), Kohl's (NYSE: KSS), Farfetch (NYSE: FTCH), BJ's Wholesale (NYSE: BJ), Clearfield (Nasdaq: CLFD), Dole (NYSE: DOLE), Gap (NYSE: GPS), NetEase (Nasdaq: NTES), Williams-Sonoma (NYSE: WSM), Diana Shipping (NYSE: DSX), StoneCo (Nasdaq: STNE), Brady (NYSE: BRC), Ross Stores (Nasdaq: ROST), Weibo (Nasdaq: WB), Gambling.com Group (Nasdaq: GAMB), Camtek (Nasdaq: CAMT), Keysight Technologies (NYSE: KEYS), Children's Place (Nasdaq: PLCE), UGI (NYSE: UGI), Vipshop (NYSE: VIPS).

Notable IPOs Today: Adamas One Corp. Common Stock (Nasdaq: JEWL), iShares Environmentally Aware Real Estate ETF (Nasdaq: ERET).

Notable Equity Crowdfunding Campaigns Ending Today: Green Island EV Corp. (Raise Green), Stride Tech Medical (StartEngine).

Notable Economic Events Today: Jobless Claims (8:30 a.m. ET), Building Permits (8:30 a.m. ET), Philadelphia Fed Manufacturing Index (8:30 a.m. ET),  Housing Starts (8:30 a.m. ET).

Cisco’s Improved Supply Situation

Positive financial earnings results sent shares of Cisco Systems (Nasdaq: CSCO) up 4.01% in after-hours trading on Wednesday.

Financials: Cisco reported earnings of 86 cents per share and revenue of $13.68 billion; both were better than expected.

Growth: Revenue increased by 6% year-over-year and it was the largest quarterly revenue in company history. Cisco is also increasing its full-year guidance.

Improved: Cisco’s supply chain situation, a sore spot for the company, is finally “easing.” This should help with future earnings.

Final Thoughts: Margins are still a problem for Cisco. The company is hoping that its improved supply situation leads to better results. Cisco is down 29% this year.

Mexico EV Growth in Doubt?

Francisco Garza, the head of General Motors (NYSE: GM) in Mexico, told Reuters on Wednesday that he only sees 15% of the cars produced in the country in 2030 as being electric, which is lower than expected.

Final Thoughts: Hopefully this prediction is wrong. GM and other automobile companies are predicting big things for electric vehicles.

Trends to Watch

Energy Champ: Diesel Hits Record Premium Over Gas, Oil (The Wall Street Journal)

Bottoms Up: Have Crypto Markets Reached Bottom? (CoinDesk)

Time for Some Reflection: Crypto’s free-wheeling firms lured millions. FTX revealed the dangers. (The Washington Post)

Strong Economy: US Shoppers Are Still Spending, as Long as Retailers Give Them a Reason (The New York Times)

Off Target: Target’s 3Q profit drops 52% as shoppers force price cuts (The Associated Press)

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