The suspected decline in the prospects of the companies oriented in the boom of artificial intelligence has been further underscored by recent developments. This is because Nvidia, which in many ways has been one of the key names at the forefront of the AI boom, has had to adhere to lukewarm responses from markets.
Q2 Earnings Beat Estimates
The company recently released Q2 earnings. In these earnings, the company managed to beat expectations by increasing the chipmaker’s revenue.
The company generated a revenue of USD 30.4 billion in the recently concluded quarter. This figure is up by a mammoth 125 per cent from the year before. In addition, as mentioned before, it also beat expectations, as the revenue was USD 700 million more than analysts’ consensus of USD 28.7 billion, reports claimed.
The company’s net income also increased by 168 per cent, climbing USD 16.6 billion, as per Forbes.
Nvidia Shares Suffer
The markets, however, did not resonate with the sentiment expressed in the earnings, as the company’s prospects dipped at Wall Street.
The makers of the powerful Blackwell chips saw their shares drop by 2.10 per cent or USD 2.69, dropping to USD 125.61 a share.
This appears to have gotten worse after the official market hours. In the after-hours, the Nvidia shares dropped 6.89 per cent or USD 8.66, indicating greater disinterest and a mini-exodus from Nvidia.
The apparent decline in the progress of Nvidia and other Al-related tech companies has been persistent for the past months, and the situation has only exacerbated from there on.
This performance of the company has also brought the tech-heavy Nasdaq index down as well. The Nasdaq Composite declined by 1.12 per cent or USD 198.79, closing at USD 17,556.03.
It was recently that investing firm Elliot also came out and called tech companies like Nvidia to be in some kind of ‘bubbleland’.
While the company in the play has been pumping in their resources for the AI projects, the market’s hope and expectation of it being the game-changer that it is touted to be is only waning with every such development. In addition, the global apprehension and potential regulations stemming from those concerns is another factor placating the high-tech paradigm.
