To The Moon

Analyst Ming-Chi Kuo, who knows the most about $Apple (AAPL)$, summarizes his views on $Nvidia's (NVDA)$ Q2 FY2025 earnings below.

1. Revenue Expectation Difference: For Q3 FY2025 revenue, sell-side expectations were in the range of $30 billion to $32 billion, while buy-side expectations were about 10% higher at $33 billion to $35 billion.This difference was one of the main reasons for the decline in the stock price after the release of the earnings report.

2. Blackwell Re-Throw Expense Impact: Kuo mentioned that the expenses incurred for the Blackwell Re-Throw (RTO) could have an impact on Nvidia's profit and earnings per share (EPS), and that this negative impact could be sustained.The impact of the product transition period was not widely discussed prior to the earnings report, which is unfavorable to the short-term stock price.

3. GB200 shipment estimates: According to Kuo's supply chain survey, shipments of GB200 NVL36 are expected to reach about 3,000 to 5,000 cabinets by the end of 2024, which is in line with Nvidia's mention that the Blackwell chip is expected to generate billions of dollars in revenue in the fourth quarter.

4. Share price performance vs. investor expectations: post-earnings share price performance primarily reflects short-term investor expectations for Q2 FY2025 earnings and is not necessarily indicative of share price trends in the months ahead.Nvidia noted that the Blackwell chips will contribute revenue in Q4, which could help alleviate investor concerns about delays in GB200 shipments, therebyfavoring stock price trends in the coming months.

Long-term recommendations

1. Focus on Product Shipments:For long-term investors, Kuo suggests focusing on Nvidia's product shipments, particularly shipment expectations for the GB200 NVL36.Shipments are expected to reach 3,000 to 5,000 cabinets by the end of 2024, which is in line with Nvidia's long-term revenue expectations.

2. INVESTOR CONFIDENCE: Kuo mentioned that Nvidia mentioned in its earnings report that the Blackwell chip will contribute to revenue in the fourth quarter, which could help ease investor concerns about delays in GB200 shipments, thus favoring the stock price trend in the coming months.Therefore, long-term investors should pay attention to how the company manages investor confidence and market expectations.