Nvidia Stocks Decline 1.35% as $108 Billion Guide Sets the Next Revenue Hurdle

This article first appeared on GuruFocus.

Nvidia (NASDAQ:NVDA) has a high bar to clear: $108 billion in quarterly revenue. Shares fell 1.35% to $203.90 at 8:41 a.m. ET on November 4 in premarket trading, as investors weighed the next earnings test. A Trefis review put the Vera Rubin rollout in focus, but the revenue target comes from Nvidia’s existing guidance. The challenge is turning another product transition into profitable growth.

Nvidia’s fiscal second-quarter release showed approximately $96.2 billion in revenue and a 75% non-GAAP gross margin. Its third-quarter outlook puts revenue within 2% of the $108 billion midpoint and gross margin at 74%, plus or minus half a percentage point. That forecast excludes China data-center compute sales. Using rounded figures, Nvidia needs another $11.8 billion in sequential revenuea 12.3% increasewhile absorbing a projected one-percentage-point margin decline. At the midpoint, those assumptions imply roughly $79.9 billion in gross profit.

The GuruFocus chart adds perspective: Nvidia’s GF Score of 96/100 reflects strong profitability, growth, financial strength and momentum, while GF Value is visibly its weakest dimension. That suggests business quality may offer more support than valuation. The next report therefore needs to show more than rising sales. Shipment execution and transition costs could determine how much of that additional revenue reaches gross…