The 10-second takeaway
For the quarter ended July 29 (Q2), NVIDIA beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded slightly and GAAP earnings per share dropped significantly.
Gross margins improved, operating margins dropped, net margins shrank.
NVIDIA recorded revenue of $1.04 billion. The 32 analysts polled by S&P Capital IQ looked for revenue of $1.01 billion on the same basis. GAAP reported sales were 2.7% higher than the prior-year quarter's $1.02 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.27. The 22 earnings estimates compiled by S&P Capital IQ anticipated $0.22 per share. GAAP EPS of $0.19 for Q2 were 24% lower than the prior-year quarter's $0.25 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 51.8%, 10 basis points better than the prior-year quarter. Operating margin was 13.4%, 450 basis points worse than the prior-year quarter. Net margin was 11.4%, 350 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.18 billion. On the bottom line, the average EPS estimate is $0.28.
Next year's average estimate for revenue is $4.41 billion. The average EPS estimate is $0.95.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 5,313 members out of 5,548 rating the stock outperform, and 235 members rating it underperform. Among 1,163 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,123 give NVIDIA a green thumbs-up, and 40 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on NVIDIA is outperform, with an average price target of $16.12.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend NVIDIA. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.