Data Center
Nvidia Fiscal Q1: Perfect Quarter, Imperfect Catalysts
Nvidia’s earnings report can best be described by a Shakespeare line in Henry IV: “Heavy is the head that wears the crown.” When it comes to stocks, being on top is harder than it looks. You are no longer afforded the element of surprise, and particularly important for Nvidia, you must produce new catalysts that can contend with the previous, hard-hitting catalyst that drove the company’s historic growth in previous years. The catalysts on the horizon are imperfect, whether it’s custom silicon gaining traction as inference scales or the attach rate on CPUs-to-GPUs shifting as agentic AI requires more orchestration. Nvidia is also seeing heightened supply-related commitments, likely due to steep HBM and NAND pricing. The company is also changed its reporting segments, and below, I discuss why that raises concerns.
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