Stocks seesawed between gains and losses Friday as concerns over slowing growth mixed with some optimism about trade talks with China after some encouraging comments from President Trump. The Dow Jones Industrial Average (DJINDICES:^DJI) and the S&P 500 (SNPINDEX:^GSPC) rose but still lost ground for the week.
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Energy stocks made a comeback after oil prices stabilized, with the Energy Select Sector SPDR ETF (NYSEMKT:XLE) closing up 1.2%. Retail stocks, though, ended their bad week by adding to their losses; the SPDR S&P Retail ETF (NYSEMKT:XRT) fell 1.4%.
NVIDIA suffers from "crypto hangover"
Shares of semiconductor company NVIDIA plummeted 18.8% after the company missed expectations for third-quarter results and gave disappointing Q4 guidance, thanks to the sudden disappearance of the cryptocurrency mining market. Revenue grew 21% to $3.18 billion, which missed the company's guidance from three months ago, and non-GAAP earnings per share increased 38% to $1.84, below Wall Street's estimate of $1.91.
A spike in demand for NVIDIA's graphics processors from cryptocurrency miners pumped up NVDIA's results and investor interest in the stock earlier this year, but falling cryptocurrency prices made the practice unprofitable, and left the distribution channel with excess inventory. NVIDIA said that inventory is selling off more slowly than expected, resulting in depressed sales by its gaming unit in Q3 and for the next quarter or two.
Revenue from the company's gaming segment still grew 13%, while revenue from professional visualization was up 28%, data center increased 58%, and automotive jumped 19%. Despite solid results, the short-term disappointment was enough to send the stock's valuation down to its lowest multiple of earnings in years.
Growth is paramount for Viacom
Cable giant Viacom announced surprisingly strong fiscal fourth-quarter results on the strength of its Paramount Pictures unit, and shares moved up 3.6%. Revenue increased 5% to $3.49 billion and adjusted earnings per share came in at $0.99. Analysts were expecting Viacom to earn $0.95 per share on revenue of $3.37 billion.
Revenue from Paramount grew 25% to $984 million, thanks to movie hits like Mission Impossible: Fallout and 127% growth in revenue from television production. Media networks had a 1% decline in revenue to $2.52 billion, with a 4% increase in affiliate revenue more than offset by a 6% drop in revenue from advertising.
Viacom is meeting the cord-cutting challenge by ramping up production of content for streaming services, such as Tom Clancy's Jack Ryan for Amazon and Maniac for Netflix. The company expects the strategy will help it return to top-line growth on 2019.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jim Crumly owns shares of AMZN, NFLX, and Nvidia. The Motley Fool owns shares of and recommends AMZN, NFLX, and Nvidia. The Motley Fool has a disclosure policy.