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Semiconductor giant Nvidia’s (NASDAQ: NVDA) reign as the artificial intelligence leader might face threats to retaining investors’ favor based on the company’s earnings report. Nvidia is particularly grappling with the challenge of surpassing market expectations as its revenue forecasts continue narrowing the gap with analyst estimates, according to The Kobeissi Letter. For the last quarter of 2024, Nvidia expects a revenue of about $37.5 billion (±2%). This projection exceeds Wall Street’s expectations by just $400 million—the smallest margin in at least two years. Nvidia’s waning forecast chart. Source: Bloomberg The concern arises from the fact that this is the second consecutive quarter where Nvidia’s revenue guidance failed to exceed analyst estimates by over $1 billion. In contrast, during Fiscal Q2 2024, Nvidia delivered a blowout forecast, surpassing expectations by an impressive $3.8 billion. It’s worth noting that these strong forecasts partly drove Nvidia’s stock rally in 2024. Therefore, Nvidia’s ‘forecast magic’ might be waning if this trend is unsustainable. One lingering question is whether the AI giant’s expectations have grown too ambitious, making it harder for the company to sustain its momentum in the chip sector. “Nvidia’s, $NVDA, revenue forecast for the next quarter beat expectations by the lowest margin in at least 2 years. <…> In other words, it is increasingly tougher for $NVDA to impress investors. Have expectations for Nvidia gotten too high?” The platform posed.  Wall Street take on Nvidia forecast  Indeed, the company’s forecast has also caught the attention of Wall Street analysts, who have revised NVDA’s share price. As reported by Finbold, Bernstein’s Stacy Rasgon noted that the company’s forecast for the coming quarters after its Q3 earnings report was slightly below bullish expectations. However, Rasgon pointed out that NVDA likely has more upside based on an implied Blackwell Q4 forecast. Similarly, Phillip Securities analyst…

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Filed under: News - @ November 24, 2024 2:12 pm