Nvidia has become world’s ‘most important stock,’ adding pressure to upcoming earnings report
Nvidia CEO Jensen Huang makes a speech at an event at COMPUTEX forum in Taipei, Taiwan June 4, 2024.
Ann Wang | Reuters
For Nvidia investors, the past two years have been a joyride. But recently they’ve been on more of a roller coaster.
As the primary beneficiary of the artificial intelligence boom, Nvidia has seen its market cap expand by about nine-fold since the end of 2022. But after reaching a record in June and briefly becoming the world’s most valuable public company, Nvidia proceeded to lose almost 30% of its value over the next seven weeks, shedding roughly $800 billion in market cap.
Now, it’s in the midst of a rally that’s pushed the stock within about 7% of its all-time high.
With the chipmaker set to report quarterly results on Wednesday, the stock’s volatility is top of mind for Wall Street. Any indication that AI demand is waning or that a leading cloud customer is modestly tightening its belt potentially translates into significant revenue slippage.
“It’s the most important stock in the world right now,” EMJ Capital’s Eric Jackson told CNBC‘s “Closing Bell” last week. “If they lay an egg, it would be a major problem for the whole market. I think they’re going to surprise to the upside.”
Nvidia’s report comes weeks after its mega-cap tech peers got through earnings. The company’s name was sprinkled throughout those analyst calls, as Microsoft, Alphabet, Meta, Amazon and Tesla all spend heavily on Nvidia’s graphics processing units (GPUs) to train AI models and run massive workloads.
In Nvidia’s past three quarters, revenue has more than tripled on an annual basis, with the vast majority of growth coming from the data center business.
Analysts expect a fourth straight quarter of triple-digit growth, but at a reduced pace of 112% to $28.7 billion, according to LSEG. From here, year-over-year comparisons get much tougher, and growth is expected to slow in each of the next six quarters.
Investors will be paying particularly close attention to Nvidia’s forecast for the October quarter. The company is expected to show growth of about 75% to $31.7 billion. Optimistic guidance will suggest that Nvidia’s deep-pocketed clients are signaling an ongoing willingness to open their wallets for the AI buildout, while a disappointing forecast could raise concern that infrastructure spending has gotten frothy.
“Given the steep increase in hyperscale capex over the past 18 months and the strong near-term outlook, investors frequently question the sustainability of the current capex trajectory,” analysts at Goldman Sachs, who recommend buying the stock, wrote in a note last month.
Much of the optimism heading into the report — the stock is up 8% in August — is due to comments from top customers about how much they’re continuing to shell out for data centers and Nvidia-based infrastructure.
Last month, the CEOs of Google and Meta enthusiastically endorsed the pace of their buildouts and said underinvesting was a greater risk than overspending. Former Google CEO Eric Schmidt recently told students at Stanford, in a video that was later removed, that he was hearing from top tech companies “they need $20 billion, $50 billion, $100 billion” worth of processors.
But while Nvidia’s profit margin has been expanding of late, the company still faces questions about the long-term return on investment that clients will see from their purchases of devices that cost tens of thousands of dollars each and are being ordered in bulk.
During Nvidia’s last earnings call in May, CFO Collette Kress provided data points suggesting that cloud providers, which account for over 40% of Nvidia’s revenue, would generate $5 in revenue for every $1 spent on Nvidia chips over four years.
More such stats are likely on the way. Last month, Goldman analysts wrote, following a meeting with Kress, that the company would share further ROI metrics this quarter “to instill confidence in investors.”
Blackwell timing
Jensen Huang, co-founder and chief executive officer of Nvidia Corp., displays the new Blackwell GPU chip during the Nvidia GPU Technology Conference on March 18, 2024.
David Paul Morris/Bloomberg via Getty Images
The other major question facing Nvidia is the timeline for its next-generation AI chips, dubbed Blackwell. The Information reported earlier this month that the company is facing production issues, which will likely push big shipments back into the first quarter of 2025. Nvidia said at the time that production was on track to ramp in the second half of the year.
The report came after Nvidia CEO Jensen Huang surprised investors and analysts in May by saying the company will see “a lot” of Blackwell revenue this fiscal year.
While Nvidia’s current generation of chips, called Hopper, remain the premium option for deploying AI applications like ChatGPT, competition is popping up from Advanced Micro Devices, Google and a smattering of startups, which is pressuring Nvidia to maintain its performance lead through a smooth upgrade cycle.
Even with a potential Blackwell delay, that revenue could just get pushed back into a future quarter while boosting current Hopper sales, especially the newer H200 chip. The first Hopper chips were in full production in September 2022.
“That shift in timing doesn’t matter very much, as supply and customer demand has rapidly pivoted to H200,” Morgan Stanley analysts wrote in a note this week.
Many of Nvidia’s leading customers say they need the additional processing power of Blackwell chips in order to train more advanced next-generation AI models. But they’ll take what they can get.
“We expect Nvidia to deemphasize its Blackwell B100/B200 GPU allocation in favor of ramping up its Hopper H200s in” the second half of the year, HSBC analyst Frank Lee wrote in a August note. He has a buy rating on the stock.
The Hers app arranged on a smartphone in New York, US, on Wednesday, Feb. 12, 2025.
Gabby Jones | Bloomberg | Getty Images
Shares of Hims & Hers Health fell 9% in extended trading on Monday after the telehealth company reported second-quarter results that missed Wall Street’s expectations for revenue.
Here’s how the company did based on average analysts’ estimates compiled by LSEG:
- Earnings per share: 17 cents adjusted vs. 15 cents
- Revenue: $544.8 million vs. $552 million
Revenue at Hims & Hers increased 73% in the second quarter from $315.6 million during the same period last year, according to a release. Hims & Hers reported a net income of $42.5 million, or 17 cents per share, compared to $13.3 million, or 6 cents per share, during the same period a year earlier.
For its third quarter, Hims & Hers said it expected to report revenue between $570 million to $590 million, while analysts were expecting $583 million. The company said its adjusted EBITDA for the quarter will be between the range of $60 million to $70 million. Analysts polled by StreetAccount were expecting $77.1 million.
Hims & Hers has faced controversy in recent months over its continued sale of compounded GLP-1s, which are cheaper, unapproved versions of the blockbuster diabetes and weight loss drugs. Compounded drugs can be mass produced when brand-name treatments are in shortage, but the U.S. Food and Drug Administration announced in February that ongoing supply issues had been resolved.
Some telehealth companies, including Hims & Hers, have continued to offer the compounded medications. It’s legal for patients to access personalized doses of the knockoffs in unique cases, like if they are allergic to an ingredient in a branded product, for instance. Hims & Hers has said consumers may still be able to access personalized doses through its site if clinically applicable.
In June, Hims & Hers shares tumbled more than 30% after a short-lived collaboration with Novo Nordisk fell apart. The drugmaker said Hims & Hers “failed to adhere to the law which prohibits mass sales of compounded drugs” under the “false guise” of personalization.
Hims & Hers reported adjusted EBITDA of $82 million for its second quarter, up from $39.3 million last year and above the $73 million expected by StreetAccount.
Hims & Hers will host its quarterly call with investors at 5 p.m. ET.
YTD chart of Hims & Hers Health.
–CNBC’s Annika Kim Constantino contributed to this report
Palantir topped Wall Street’s estimates Monday, surpassing $1 billion in quarterly revenue for the first time, and hiking its full-year guidance.
Shares rallied more than 5%.
Here’s how the company did versus LSEG estimates:
- Earnings per share: 16 cents adj. vs. 14 cents expected
- Revenue: $1.00 billion vs. $940 million expected
The artificial intelligence software provider’s revenues grew 48% during the period. Analysts hadn’t expected the $1 billion revenue benchmark from the Denver-based company until the fourth quarter of this year.
“The growth rate of our business has accelerated radically, after years of investment on our part and derision by some,” wrote CEO Alex Karp in a letter to shareholders. “The skeptics are admittedly fewer now, having been defanged and bent into a kind of submission.”
The software analytics company also boosted its full-year outlook guidance. For the full year, Palantir now expects revenues to range between $4.142 billion and $4.150 billion, up from prior guidance of $3.89 billion to $3.90 billion.
For the third quarter, Palantir forecast revenues between $1.083 billion and $1.087 billion, beating an analyst estimate of $983 million. Palantir also lifted its operating income and full-year free cash flow guidance.
Palantir’s U.S. revenues jumped 68% from a year ago to $733 million, while U.S. commercial revenues nearly doubled from a year ago to $306 million.
The software analytics company has seen a boost from President Donald Trump‘s government efficiency campaign, which included layoffs and contract cuts. Palantir’s U.S. government revenues jumped 53% from the year-ago period to $426 million.
“It has been a steep and upward climb — an ascent that is a reflection of the remarkable confluence of the arrival of language models, the chips necessary to power them, and our software infrastructure,” Karp wrote in a letter to shareholders.
During the quarter, Palantir said it closed 66 deals of at least $5 million and 42 deals totaling at least $10 million. Total value of its contracts grew 140% from last year to $2.27 billion.
Net income rose 144% to about $326.7 million, or 13 cents a share, from about $134.1 million, or 6 cents per share a year ago.
Palantir shares have more than doubled this year as investors bet on the company’s AI tools and contract agreements with governments.
Its market value has accelerated past $379 billion and into the list of top 20 most valuable U.S companies, surpassing Salesforce, IBM and Cisco to join the top 10 U.S. tech companies by market cap. Shares hit a new high Monday.
At its size, buying the stock requires investors to pay hefty multiples.
Shares currently trade 276 times forward earnings, according to FactSet. Tesla is the only other top 20 with a triple-digit ratio at 177.
Palantir one-day stock chart.
Firefly Aerospace CEO Jason Kim sits for an interview at the Firefly Aerospace mission operations center in Leander, Texas, on July 9, 2025.
Sergio Flores | Reuters
Firefly Aerospace has lifted the share price range for its upcoming initial public offering in a move that would value the space technology company at more than $6 billion.
The lunar lander and rocket maker said in a filing Monday that it expects to price shares in its upcoming IPO between $41 and $43 apiece.
Firefly’s new target range would raise nearly $697 million at the top end of the range. That’s up from the previously expected $35 to $39 price per share that Firefly announced in a filing last week, which targeted a $5.5 billion valuation.
Firefly announced plans to go public last month as interest in space technology gains steam, and billionaire-led companies such as Elon Musk‘s SpaceX rake in more funding.
The industry has also begun testing the public markets after a long hiatus in IPO deal activity, with space tech firm Voyager debuting in June.
Firefly makes rockets, space tugs and lunar landers, and is widely known for its satellite launching rockets known as Alpha.
The company has partnered with major defense players such as Lockheed Martin, L3Harris and NASA, and received a $50 million investment from defense contractor Northrop Grumman.
Firefly’s revenues jumped from $8.3 million a year ago to $55.9 million at the end of March, the company said. Its net loss grew to $60.1 million, from $52.8 million a year ago.
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