Nvidia’s earnings are all about Blackwell

When the most valuable company reports its earnings this afternoon, analysts will be laser-focused on one word: “Blackwell.”

That’s the name of Nvidia’s next-generation chips that hold the key to maintaining its staggering growth in the years ahead. What CEO Jensen Huang signals about sales for Blackwell, which has just started shipping to customers, could determine whether this stock sinks or swims after the report. In its last earnings call in August, Nvidia projected that Blackwell revenue could amount to “several billion” during the January quarter, so look out for more specifics on that number.

They’re certainly an upgrade: Compared to its current bestselling H100 chips, Blackwell processors are reported to be 2.5x faster when training large language models and 5x faster for running those models in real applications, according to The Street.

But overheating might be an issue: Expect analysts to pester Huang with questions about a recent Information report that claims Blackwell is experiencing overheating problems when installed in servers. Design flaws have already slowed down production of Blackwell, though Huang said in October those had been patched up.

Expect a big stock swing either way

Nvidia’s earnings always deliver fireworks, and today’s should be no different. Bloomberg says the options-implied move for Nvidia’s stock is about 8% in either direction, equivalent to about $300 billion in market cap, or more than the value of all but 25 companies.

Nvidia’s stock has swung an average of more than 9% after its last eight reports, per Citigroup strategist Vishal Vivek. Shares fell 6.4% in the trading session following Nvidia’s most recent report in August, when it beat expectations but not by enough to “wow” Wall Street.

Other key numbers to know:

• Nvidia will start to face tougher year over year comparisons, so revenue growth should come down from stratospheric heights. Analysts polled by LSEG project $33.12 billion in quarterly sales, or 83% growth from a year ago. That’d be lower than the 122% revenue growth it reported in the August quarter and 262% the quarter before that.
• Profits are projected to be $17.4 billion, an 89% increase from $9.2 billion last year.

Bottom line: Nvidia’s stock is still ripping due to its 80% market share of the exploding AI chip market. Shares have gained more than 200% this year and have ballooned over 1,100% in the last two years.—NF