Nvidia expects mixed results for third quarter, stocks falling despite strong year

(MENAFN) On Wednesday, Nvidia Corp. projected a third-quarter gross profit margin that fell short of market expectations, while its revenue forecast was broadly in line with analysts' predictions. The company's shares experienced a 4 percent decline in after-hours trading, reflecting investor disappointment. Nvidia's stock had previously surged more than 150 percent this year, but it closed down 2 percent during the regular trading session on Wednesday.

Nvidia anticipates an adjusted gross profit margin of 75 percent, with a margin of error of 50 basis points, for the third quarter. Analysts had expected a slightly higher average margin of 75.5 percent, according to data from the London Stock Exchange Group. The company's gross profit margin for the second quarter was 75.7 percent, just shy of the anticipated 75.8 percent.

Despite its stock's dramatic rise over the past two years, driven by the boom in AI-related investments, Nvidia's forecast did not meet the high expectations set by investors. The company expects third-quarter revenue to range between USD32.5 billion, plus or minus 2 percent, aligning closely with analysts' average estimate of USD31.77 billion. This follows a strong second-quarter performance where Nvidia reported revenue of USD30.04 billion, surpassing estimates of USD28.70 billion. 

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