A current holding within the US Growth portfolio, chipmaker Nvidia (NVDA) announced Q2 earnings this morning.
Comfortably beating estimates and providing improved guidance for Q3. As a reminder, NVDA sits within the momentum component of the US Growth portfolio, and has returned 76% since its inclusion in the portfolio.
With revenues doubling to $13.5 billion in Q2 vs. the $11.04 expected and profits exceeding analyst expectations at $2.07 a share with an actual $2.70, Nvidia appears unstoppable. It has already hit the landmark $1 trillion market valuation, surpassing Intel in quarterly sales for the first time. This demonstrates how its product offerings have moved to becoming absolutely essential in today’s tech-driven world. Understandably, the market has reacted positively to the news, with shares up 6.57% in after-hours trading after a 3% rise on Wednesday.
What is striking is the significant improvement in the company’s adjusted gross margin, which stood at 71.2%, a sharp rise from last year’s 45.9%. Operating expenses were well-managed, coming in lower than estimates, which further contributed to an impressive adjusted operating income of $7.78 billion. These numbers not only beat analyst expectations but also signify operational efficiency, a critical factor for long-term success.
