Just another day where Nvidia and any other company can't please. Wall Street So Nidia absolutely crushed it when it came down to its quarterly earning report that it released today. And trust me, I Believe that the NASDAQ Market is extremely overbought. It's nearly at all-time highs and I wanted the NASDAQ Market to pull on back I mean I Wasn't sad to see that Nvidia pulled back.

but it takes me back to that same idea of like you can never play Wall Street Nvidia's numbers with earnings per share and with Revenue were so, so strong and that became a concern for investors. I'm going to be breaking it all down for you guys in this video. so sit back relax. I Hope that I earned your thumbs up And remember, don't forget To subscribe I Do Trade Live Every Morning! I'd love to see you for tomorrow's live trading session.

So if you like what you saw today, click the second link in the description down below to learn more about being able to watch me trade live. But let's go ahead and jump right into it. So n crushed its earnings. When it came down to estimates of its EPS of $336 it came in at $42 Its Revenue had an expectation of 16.1 billion.

It came in at 18.1 So overall expectation was blown out of the water. So why is it that Nvidia stock after market hours after reporting earnings and not just during its earnings, but its actual earnings call Nvidia and ended up in the red right? ended up being down 1.73% and at one point it was down 3% So why why is there such a Negative sentiment towards this? I'm going to just get straight to it and then I'm going to be showing you a video. So the idea behind this is the fear of first Nvidia might be growing too quick and investors are in fear that, well, how long can Nvidia keep up this growth? This kind of gives you a timeline um of how the growth has been for revenue for NVIDIA from 2021, right? being at 3 billion and now being at 18 billion. a significant increase quarter after quarter after quarter after quarter and all most of this demand is coming through or because artificial intelligence.

The second thing that needs to be taken into consideration is that the stock market reaction to the report was muted. However, the company noted new restrictions on chip exports to China would weigh on results share of the chip maker Nidia were down more than 1% after market hours on Tuesday night. or and then this is a quote, right? Our sales to China and other affected destinations derived from products and are subject to licensing requirements have constantly contributed to approximately 20 to 25% of data center Revenue over the past quarters. So this is something that was stated from the CFO.

So we expect our sales for these destinations that they will decline significantly in the quarter in the fourth quarter of fiscal 2024. So I mean they're just being upfront right where the fourth Quarter of 2024? They're saying that Yeah, you know we might see some form of slowdown in upand cominging quarters now. I Get it right, Investors want to pull out their money once they see that growth might be peing. I Want to give you an example of why this might be right? I Don't know if you guys remember this company called Cvna and it was called Carvana, right? It's still a company that's publicly traded current market cap at $6.2 trillion.

but at one point Carvana was killing it, especially during the pandemic, right? It hit highs of $376 per share and it saw this growth within a very short period of time. So this is where I do kind of understand. But I wanted to give you a real world example. because why Why would a company beating expectations for earnings per share and for Revenue showing exceptional growth right? being the market and world leader in chip manufacturing, why is it down? After proving that it's better than what Wall Street expected? And it's because if it continues to grow quicker than what it anticipated, and if it can't keep up with demand, or if demand ends up dying out, then again, at one point it's expected that it might Peak and then begin to retrace from there and investors at that point then want to lock in profits.

If there's any sign of slowing down, right? If there's no signs of continuous growth, they want to make sure that they can exit properly in fear of a potential retracement if demand begins to fall. But I thought that instead of just talking about it I can give you a real world example. But let's go ahead and talk about this um and show you this video real quick. AR Expected AR Delivered.

Was the bar just that high? Yeah. I think the bar is high, but you know again, the demand the Need for Speed across these data centers and I'm I'm really looking forward to to hearing the conference call if if a lot of the sales were in that space. Um, but you know there's a lot of deep pocket customers out there that are willing and need to spend this money. so you know I Think it's really important in all these conversations about Invidia and Ai and this Need for Speed that we're early in the cycle.

I I Think when people get concerned about the stocks movement, they have to realize this is a multi-year transformational change in technology and we're really at the early stages and they are at the full position. I'd like to say they're the only game in town or as we like to call them, the Magnificent one. Well, also in the early stages of the after hours action: Stacy The stock initially moved higher, then it moved a lot lower. Now it's kind of in the middle.

It's only you know it's down 2% But what's particularly important to hear color-wise on the call is it really about? I Think you mentioned demand and the degree to which Nvidia understands exactly how these chips are being put to use right now versus how many might be stockpiled. Yeah again, the question is like I said the numbers Like I said this earlier. the numbers get so big so quickly people wonder about sustainability and so we'll want to get some better feeling for how much visibility they have. Um, in terms of like, how long are their cycle times? how involved are they in the deployments? By the way, I do think they're very involved in those deployments I don't think they're just like throwing Gpus over the wall, right? I Think they know, but but anything they can give us on that The other thing I'll be listening for clearly is China I'd love to know if the China sanctions actually impacted these results at all.

Like would they've even been higher without that and what are they doing in China What are their expectations for that market? Um, and how should we be thinking about um, the prospects for ability to sell into that market over time? James I mean we know supply has not been keeping Pace with demand. but when I see EPS numbers that are up 12-fold over the past year? I I mean how quickly can this company ramp that supply And what does it mean in terms of the Investments that have to come alongside it even as it earns hand over fist here? Yeah. Morgan Great question. You know that's that is a certain a concern.

Can they keep up with this incredible demand? You know? And I think that this is where you have a company that's extremely well managed. I mean uh, Jensen really knows This business knows it well. Uh, and I think you know that's where as a stockholder shareholder ourselves? Um, we really want to look at management. Can they maneuver our their way through this transformational change from the number one position? and Frankly Speaking that's where you have to have a lot of confidence in management and we do uh in Jensen here.

All righty and there you have it. So um, again, the overall breakdown for NVIDIA The biggest concern that I just want you to take into consideration is that my takeaways from that video is that Nvidia is relatively pretty early on when it comes down to this whole wave of artificial intelligence obviously going from $100 a share to $500 a share within a very short period of time. I Mean we're literally talking in one year, right? to be able a 5x the valuation of your company for it Now to be one of the trillion doll companies, one of the most valuable companies that's publicly traded. Um, I'm I'm not surprised that Wall Street is beginning to ask the question Of okay, is is this it right? But then when I I I really like the way that that gentleman put it, is that Nvidia and when it comes down to artificial intelligence is so young, especially in our world today, right? And if demand continues to ramp up, the video right now now is world leader right when it comes down to chip manufacturers uh, for that type of stuff.

So I could only imagine that demand should continue and as more Innovation is made in that space, then you know hopefully more competition arises. Uh, but as of right now it's Nvidia right? Um, but I just wanted to make sure that you guys had a better understanding of what it reported. that it was really good news, but some concerns that some of the investors had right when it came down to sustainability. Can it continue to grow at this same rate? Um.

and obviously the issues that it might be having Um with the restrictions going on in China So as I begin to learn more about it again, I'll make sure that I keep you guys up to date, especially if you're part of our Lpp team. If I see anything significant being released, then again, I'd be more than happy to share it with you guys. But I do want to remind you that I mean the report itself that it released was a very, very good earnings report. Yes, it's down as of right now, but we'll see once the Market opens tomorrow.

we could see a quick change of direction as the Market's been more bullish than bearish. I'm just really excited to take on the market with all of you guys that end up joining me for that live trading session which again is the second link in the description down below. I Appreciate your time I Hope that it earned a thumbs up. Please consider subscribing And like always, let's make sure that we end the year on a green note.

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