The demand for data center components seems to have also gained momentum during the quarter and this is likely to help the topline results. NVIDIA’s investments in artificial intelligence capabilities also bode well as there is increasing growth potential in this space.
In the second quarter of 2020, NVIDIA reported revenue and earnings that were lower versus the previous year but ahead of Street expectations. Revenue dropped 17% to $2.58 billion, hurt by weakness in the data center and GPU businesses. Adjusted EPS fell 36% to $1.24.
Also read: NVIDIA Q2 2020 Earnings Conference Call Transcript
For the third quarter, NVIDIA has guided for revenues of $2.90 billion, plus or minus 2%. Adjusted gross margin is expected to be 62.5%, plus or minus 50 basis points. Adjusted operating expense is forecast to be approx. $765 million.
Shares of NVIDIA have gained 57% year-to-date and 36% over the past three months. The majority of analysts have rated the stock as Buy and it has an average 12-month price target of $201.83.