Nvidia prepares for earnings: investors weigh AI chip prospects amid competition
Date: 2025-02-25 Author: Henry Casey Categories: BUSINESS
The launch of DeepSeek's R1 chip has sent Nvidia's market cap down to a record $593 billion, raising concerns that the company could lose ground in the advanced AI space.
Ivana Delevska, CIO at Spear Invest, said that if Nvidia beats analysts' estimates and raises its own guidance, it would be a positive sign for the company's stock.
Nvidia is expected to post 72% year-over-year revenue growth in the October-December quarter, reaching $38.05 billion. That's the most modest quarterly gain in the past seven reporting periods, after the previous five quarters saw triple-digit growth. Revenue is expected to increase 60% year-on-year in the first quarter of 2025.
Despite concerns, the AI market remains promising. Large tech corporations including Meta, Microsoft, Google, and Amazon continue to invest heavily in AI chips. Gabelli Funds portfolio manager John Belton believes that these investments indicate strong demand for Nvidia products.
The company has already begun to transition from supplying individual chips to creating full-fledged AI computing systems, starting with the Blackwell series. However, scaling production has been complicated by technical issues, including design errors and an increased percentage of defects. However, Nvidia has managed to fix these shortcomings.
The company's management previously said that it expects to exceed initial revenue forecasts for Blackwell sales.
In 2025, Nvidia plans to release a new series of compact computers Jetson Thor, designed for humanoid robots. In December, the company unveiled the Jetson Orin Nano Super, an affordable supercomputer with generative AI aimed at the mass market.
