A year ago Nvidia sold $46.7 billion of chips in three months... last quarter it sold $96.2 billion.
The company doubled at a size where doubling is supposed to be mathmatically impossible.
Wednesday's numbers came in at $2.22 EPS against the $2.10 Wall Street was looking for… on revenue that beat the $92.17 billion consensus.
And Nvidia are now guiding to make over $100 billion in a single quarter in Q3
So while I don’t do victory laps often… today is one.
Nvidia's shares had fallen after their last 4 earnings reports…
The day before this one, a widely syndicated piece went out predicting a fifth straight post-earnings loss…
Expectations were enormous, the stock was 8% off its May high, and beating the number had stopped being enough.
But this morning the stock was up close to 6%.
And for the past 6 months… I’ve been pounding the table saying the same thing while the bear case got louder and better dressed.
Through the panic about chips being bundled into bonds… and through the phrase "circular financing" appeared in every market note in America. I remained bullish.
But it’s clear now that demand was never the question… and this quarter Nvidia proved it in a way that is very hard to argue with.
The company gave a preliminary outlook for next year of roughly 70% revenue growth.
And that’s just what Nvidia can physically build. Jensen Huang told analysts on the call that demand runs well above 70% and supply is what caps the number.
The takeaway being… a company in a demand bubble does not turn business away… It ships everything it can while the music lasts. Rationing is what you do when you cannot make enough.
So it’s clear right now… the only thing that stops the AI train is when demand cools off… and when I see that happpening, I’ll tell you.
But for now, the numbers keep going the right way.
Oliver