NVIDIA stock faced a setback as Amazon halted orders for their “superchip,” opting to wait for an updated version instead. This decision raised concerns about the vulnerability of Nvidia’s product cycle ahead of their upcoming earnings report. Amazon Web Services suspended its orders for Nvidia’s Hopper chips and will instead wait for the latest Blackwell processors. Nvidia CEO Jensen Huang had previously touted Hopper as the world’s most advanced GPU in production today. The news comes at a critical time as Nvidia is set to release its first-quarter earnings for fiscal year 2025. Analysts are expecting significant growth in earnings per share and revenue compared to the prior year.
Despite some analysts expressing concerns about a potential lull in demand during the transition from Hopper to Blackwell, others remain optimistic. KeyBanc analyst John Vinh sees limited signs of a demand slowdown, while Morgan Stanley warned of a possible “air pocket” in demand. Nvidia’s earnings surprise has been decreasing steadily since the second quarter of last year, leading to worries about the stock being overextended.
In conclusion, the decision by Amazon to halt orders for Nvidia’s superchips has raised concerns about the company’s product cycle and demand outlook. Nvidia’s upcoming earnings report will be closely watched to see if the company can maintain its growth momentum. Analysts have differing opinions on the potential impact of the transition from Hopper to Blackwell on demand for Nvidia’s products. As the company faces a critical test with its earnings release, investors will be closely monitoring the performance of NVDA stock in the coming days.
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https://investorplace.com/2024/05/nvda-stock-alert-amazon-halts-orders-of-nvidia-superchip/
