In preparation for Thursday night's second-quarter report, I explained that NVIDIA
The report is in, and CEO Jen-Hsun Huang couldn't agree more. "Our investments in mobile computing and visual computing are both paying off," he said as sales increased a modest 2.7% year over year to land at $1.04 billion. At the same time, non-GAAP earnings fell 16% to $0.27 per share. The sales tally was almost exactly what your average analyst had expected, but earnings nearly doubled the Street's $0.14 target.
NVIDIA shares jumped as much as 4.7% overnight before settling in to more modest gains on Friday morning. Nomura Securities hailed the report with a reiteration of its existing "buy" rating and $18 price target. Strong guidance may point to some of that unexpected gravy in the form of good graphics-chip sales this fall, the firm believes.
Indeed, NVIDIA predicts revenue growth of about 12% while rivals Advanced Micro Devices
On the other hand, NVIDIA also provides the mobile brains form Google's
This company made a brilliant decision years ago to move away from selling graphics chips into stagnating systems. Instead, NVIDIA is a rising star in the booming mobile-computing segment. It's always nice to be a trailblazing leader in a trillion-dollar market revolution. But Intel wants a piece of the pie too, and NVIDIA would be wise to consider the potential threat of the Atom processor.
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Fool contributor Anders Bylund owns shares in Google but holds no other position in any of the companies mentioned. Check out Anders' holdings and bio, or follow him on Twitter and Google+. The Motley Fool owns shares of Intel, Google, and Microsoft. Motley Fool newsletter services have recommended buying shares of Microsoft, Intel, NVIDIA, and Google, writing puts on NVIDIA, and creating a bull call spread position in Microsoft. We Fools don't all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days. The Motley Fool has a disclosure policy.