As Nvidia gears up to release its highly anticipated earnings report this week, both the traditional finance (TradFi) and cryptocurrency markets are bracing for the impact. The performance of the chip giant is expected to have far-reaching implications, particularly for AI tokens in the crypto space. Here’s what you need to know about Nvidia’s earnings and its potential domino effect on the market.
Nvidia (NVDA), the leading AI chip manufacturer, will announce its results on Wednesday. Investors worldwide are eagerly anticipating this report, expecting another quarter of solid earnings and revenue growth driven by the increasing demand for AI. With a market capitalization exceeding $2.38 trillion, Nvidia’s stock price has surged to $953, representing a 200% increase over the past year and nearly 100% year-to-date.
Analysts predict that Nvidia’s sales may have nearly quadrupled in the April 2024 quarter, reaching $24.6 billion, with potentially quintupled earnings of $5.60 per share. The company’s forecasts estimate sales between $23.5 billion and $24.5 billion. This impressive growth is a testament to the scaling power of Nvidia’s AI chips, with shares closing at a record $953.86 on Tuesday.
However, Bloomberg consensus data suggests that Nvidia’s earnings for the previous quarter likely increased by over 400% and revenues surged by 242%. For the second quarter, analysts forecast revenue growth of approximately 100% and earnings expansion of over 120%.
The earnings report of Nvidia is expected to significantly influence the cryptocurrency market, particularly AI tokens. AI tokens are digital assets that support projects, applications, and services based on AI, such as decentralized AI markets, AI-driven trading algorithms, and AI-driven decentralized autonomous organizations.
Major AI tokens like Near Protocol (NEAR), Render (RNDR), The Graph (GRT), and Injective (INJ) are expected to experience price increases in response to Nvidia’s strong performance. These tokens are not only used for transactions within AI platforms but also grant governance rights to their holders.
As positive earnings outlook for Nvidia boosts confidence, AI tokens have already entered the green trading zone, indicating growing interest and optimism from investors.
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