After the close, semiconductor company NVIDIA (NVDA) is scheduled to report 3Q20 results with a conference set to follow at 5:00 p.m. E.T.
In the 2Q20 earnings report, the company guided for Q3 revenue of $4.312-$4.488 bln and Non-GAAP gross margin of 65.5%, plus or minus 50 bps.
Analysts are expecting NVDA to report EPS of $2.55 and revenue of $4.42 bln.
NVDA will likely provide Q4 revenue guidance in the earnings press release. In order to meet expectations, it will need to guide for revenue of $4.43 bln.
Last quarter, revenue in the data center segment soared by 167% to $1.75 bln, exceeding gaming revenue for the first time in the company's history.
TECHS:
The stock has been on fire this year, up 230% year-to-date. As a result, the stock is quite expensive with a 1-year forward P/E of ~50x.
However, the rich valuation has been warranted given NVDA's impressive financial performance. The company has blown out EPS expectations in each of the past four quarters with an average beat of $0.30/share.
NVDA's $40 bln acquisition of Arm will be a major topic of interest during the earnings conference call.
This deal could face regulatory hurdles as both the US and China will need to sign off on the transaction.
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