Nvidia (NVDA) will report its fiscal Q2 2022 earnings after the bell on Wednesday, and Wall Street will be focused on the continued growth of the company’s important data center and gaming segments.
Here’s what analysts are expecting of the company in the quarter, as compiled by Bloomberg, compared to how it performed in fiscal Q2 2021.
Revenue: $6.33 billion expected versus $3.86 billion in Q2 2021
EPS: $1.01 expected versus $0.55
Data Center: $2.28 billion expected versus $1.75 billion in Q2 2021
Gaming: $2.96 billion expected versus $1.65 billion in Q2 2021
Nvidia has been on a tear over the last three months with its stock price jumping 48% compared to the S&P 500’s 18%. In Q1, the company blew the doors off both of its year-over-year results, with data center revenue jumping 79% and gaming revenue up 106%.
Much of the increase in revenue had to do with higher demand for Nvidia’s data center capabilities, and a wild jump in interest for the company’s graphics cards by gamers. But availability of those cards has been incredibly tight, making it difficult for consumers to get their hands on Nvidia’s latest and greatest offerings.
And Oppenheimer’s Rick Schafer sees that continuing into Q2, and the second half of Nvidia’s fiscal second half.
“Despite constraints, we see gaming leading [fiscal Q2] growth with continued momentum into 2H led by new gaming titles, back-to-school, and holiday,” Schafer wrote in an analyst note ahead of Nvidia’s earnings. “[Data center] demand accelerates into [second half] with hyperscale spending and it increasingly favors Al neural network workloads/services.”
And while the average selling price of Nvidia’s cards may drop, as less expensive units become more readily available, BofA Global Research’s Vivek Arya says that the company’s gaming segment will continue its double-digit growth throughout fiscal year 2022.
Still, Nvidia is facing two potential overhangs: a drop in interest in card sales due to a potential slowdown in crypto mining activities, and the chance that its purchase of ARM falls through.
The $40 billion ARM purchase, which Nvidia announced in Sept. 2020, still hinges on approval by global regulators, and is still up in the air. According to Bloomberg, U.K. regulators are considering blocking the move on national security grounds.
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