Nvidia (NVDA 1.02%) is slated to report its first-quarter results for fiscal 2023 (which ended April 30) after the market close on Wednesday, May 25. An analyst conference call is scheduled for the same day at 5 p.m. ET.
The graphics chip specialist is going into its release on a strong note. Last quarter, it beat Wall Street's consensus estimates for both revenue and earnings, and issued first-quarter guidance for both the top and bottom lines that came in notably higher than analysts had been expecting.
Moreover, last quarter was at least the seventh consecutive quarter that the company topped the Street's earnings projection.
Long-term investors should keep focused on the company's results, rather than the market's reaction, as there could be a seeming disconnect. The market has declined since late last year and high-valued tech growth stocks, such as Nvidia, have been particularly hard hit.
Here's what to watch in the company's upcoming report.
Image source: Getty Images.
Nvidia's key numbers
Here are benchmarks to use to gauge the tech company's results.
| Metric | Fiscal Q1 2022 Result | Nvidia's Fiscal Q1 2023 Guidance | Wall Street's Fiscal Q1 2023 Consensus Estimate | Wall Street's Projected Growth |
|---|---|---|---|---|
| Revenue | $5.66 billion | $8.10 billion | $8.12 billion | 43% |
| Adjusted earnings per share (EPS) | $0.91* | $1.29** | $1.29 | 42% |
Data sources: Nvidia and Yahoo! Finance. Fiscal Q1 2023 ended April 30, 2022. *Adjusted to reflect 4-for-1 stock split in July 2021, which increased share count by a factor of four. **Calculated by the author based on the metrics for which management provides guidance.
For context, last quarter (fiscal Q4 2022), Nvidia's revenue jumped 53% year over year to a record $7.64 billion. As has been the case for a number of quarters, growth was driven by record revenue in the gaming, data center, and professional visualization platforms. EPS on the basis of generally accepted accounting principles (GAAP) soared 103% year over year to a record $1.18, and adjusted EPS surged 69% to $1.32.
Wall Street had been looking for revenue and adjusted EPS of $7.42 billion and $1.22, respectively, so Nvidia easily exceeded both expectations.
NASDAQ: NVDA
Key Data Points
Platform performance
Here's how the platforms performed last quarter:
| Platform | Fiscal Q4 2022 Result | Change (YOY) | Change (QOQ) |
|---|---|---|---|
| Gaming | $3.42 billion | 37% | 6% |
| Data center | $3.26 billion | 71% | 11% |
| Professional visualization | $643 million | 109% | 11% |
| Automotive and robotics | $125 million | (14%) | (7%) |
| OEM and other | $192 million | 25% | (18%) |
| Total | $7.64 billion | 53% | 8% |
Data source: Nvidia. OEM = original equipment manufacturer; not a target market platform. YOY = year over year. QOQ = quarter over quarter.
As always, investors should focus on the two largest platforms, gaming and data center. Last quarter, these two businesses combined accounted for 87.4% of the company's overall revenue.
On the earnings call, management is certain to discuss progress with its Omniverse, which is Nvidia's platform for enabling companies to build their metaverses. The company launched Omniverse last year and has been regularly rolling out additional features. This platform has the potential to significantly boost professional visualization revenue.
Reiterating what I wrote in last quarter's earnings preview, "investors shouldn't pay much attention to results in OEM and other because this category's sales can be expected to fluctuate considerably due to the extreme volatility in the cryptocurrency market." Nvidia's cryptocurrency mining processor (CMP), launched in early calendar year 2021, is included in the OEM and other category. Last quarter, the CMP generated revenue of $24 million, down from $105 million in the prior quarter.
Guidance
The market looks ahead, so management's guidance, relative to Wall Street's expectations, will likely be a major factor in the market's reaction to Nvidia's upcoming report.
For the fiscal second quarter (the May to July period), analysts are currently modeling for adjusted EPS of $1.36 on revenue of $8.46 billion, representing year-over-year growth of 31% and 30%, respectively.
