Nvda earning report seeking alpha1/7/2023 After all, crashing crypto prices have rendered crypto mining less lucrative over the recent months. Nvidia also noted in its press release that the revenue shortfall was "…primarily attributable to lower sell-in of Gaming products reflecting a reduction in channel partner sales likely due to macroeconomic headwinds." We can speculate that the revenue shortfall is likely to have occurred due to plummeting cryptocurrency mining demand. Although the company claimed in its press release that their long-term gross margin remains intact, it's unclear how long it'll take for its margin profile to bounce back to its usual 60%-plus levels. This figure may not mean much in isolation but it's actually at a decade low level for the chipmaker and drastically lower than its management's initial guidance of 65.1%. To make matters worse, Nvidia's management expects its Q2 gross margin to amount to 43.7%. As it turns out, this slowdown isn't driven by 1 revenue stream, but rather due to 3 of its 5 revenue streams. This is a far cry from the 30%-plus rates that the company has been posting for the better part of the past decade and also lower than its management's prior guidance of 19%. In a press release issued earlier this month, Nvidia's management guided for their Q2 revenue growth to amount to a mere 3%. But the chipmaker's blistering growth momentum seems to be taking a breather, at least for the time being. It also benefited immensely from the surging GPU demand from cryptocurrency miners in recent years. It remained at the forefront of technology innovation (like data center accelerators, professional visualization cards etc.) which enabled it to expand target addressable market and brought along market share gains. Let me start by saying that Nvidia has grown its top line at a spectacular pace in the last decade. Let's take a closer look to gain a better understanding of it all. In this article, I'll discuss some of the key items that investors should be watching closely, when the company releases its earnings report tomorrow. The chipmaker has already pre-released disappointing revenue and gross margin results for the quarter but there's a lot of ambiguity about its near-term prospects in light of crashing cryptocurrency mining interest, tough macroeconomic environment and intensifying market competition. Nvidia ( NASDAQ: NVDA) is scheduled to report its Q2 FY23 results after market close on Wednesday.
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