Nvidia: Best In Class Among Semiconductors In 2016
Alex Cho • 16 Comments
Alex Cho • 16 Comments
Nvidia Is A $12 Stock Worth $18: A Sum Of The Parts Analysis
Adam Levine-Weinberg • 65 Comments
Adam Levine-Weinberg • 65 Comments
Wed, Feb. 17, 4:22 PM
Fri, Jan. 15, 12:35 PM
- On a day the Nasdaq is off 4.1%, companies with strong PC exposure are seeing even bigger losses after Intel (down 9.2%) beat Q4 estimates and provided healthy 2016 sales guidance, but also reported a slowdown in server CPU sales growth and offered cautious earnings call remarks about Chinese demand and macro trends.
- Intel's Client Computing Group (provides PC/mobile CPUs) only saw a 1% Y/Y revenue drop in Q4 in the face of weak PC demand. However, volumes were down 16%, with desktop, notebook, and tablet CPU volumes respectively falling 9%, 10%, and 33%. A 17% increase in ASPs minimized Intel's revenue drop. Earlier this week, IDC and Gartner respectively estimated PC shipments fell 10.6% and 8.3% Y/Y in Q4.
- The list of PC-related names seeing big losses includes Microsoft (MSFT -4.8%), Nvidia (NVDA -6.7%), AMD (AMD -8.1%), HP Inc. (HPQ -5.2%), Micron (MU -8.9%), Seagate (STX -6.4%), and Western Digital (WDC -6.4%). AMD reports on Jan. 19, Microsoft and Western on Jan. 28, and Seagate on Jan. 29.
- In other Microsoft news, the company has carried out price cuts of up to 17% for Azure cloud computing services, following new price cuts from Amazon, and is reportedly looking to acquire Indian mobile ad network owner InMobi. Google was rumored to be in buyout talks with InMobi last year.
- AMD, meanwhile, has begun shipping its Opteron A1100 (Seattle) ARM server CPU. Seattle, first announced in 2013, sports up to eight 64-bit ARM Cortex A-57 CPU cores, and enters a market also targeted by AppliedMicro, Cavium, and Qualcomm.
Thu, Jan. 14, 9:43 AM
- Arguing fundamentals don't justify the company's current valuation following a 65% 2015 gain, Barclays' Blayne Curtis has downgraded Nvidia (NVDA) to Underweight, and cut his target by $2 to $23.
- Among chip stocks, Curtis is more partial to Cirrus Logic, Cavium, and Skyworks. Nvidia, buoyed in recent quarters by strong high-end GPU demand for gaming PCs, currently trades for 21x an FY17 (ends Jan. '17) EPS consensus of $1.36.
Tue, Jan. 5, 4:38 PM
- Mobileye (MBLY -9.6%) closed slightly above $36 after Nvidia (NVDA +1.6%) unveiled the Drive PX2, a second-gen processing module for driver-assistance and autonomous driving systems that's declared to be "the world's most powerful engine for in-vehicle artificial intelligence."
- Nvidia: "DRIVE PX 2 can process the inputs of 12 video cameras, plus lidar, radar and ultrasonic sensors. It fuses them to accurately detect objects, identify them, determine where the car is relative to the world around it, and then calculate its optimal path for safe travel. This complex work is facilitated by NVIDIA DriveWorks, a suite of software tools, libraries and modules that accelerates development and testing of autonomous vehicles."
- Nvidia also claims the PX2 can handle up to 24T A.I./deep learning operations/second (over 10x as many as the prior-gen Drive PX), thanks to specialized instructions, and that its GPU architecture can handle up to 8T operations/second for general floating-point operations.
- The module contains two Tegra processors and two GPUs based on Nvidia's next-gen Pascal architecture. Nvidia asserts the original Drive PX has been used by 50+ automakers, tier-1 auto suppliers, developers, and research institutions for autonomous driving R&D.
- Mobileye, which currently dominates the driver-assistance system market via modules sporting its EyeQ SoC (also uses A.I./deep learning algorithms), had a rough day. Shares sold off last March after Freescale unveiled a rival SoC, and last month after a leaked Elon Musk e-mail that suggested Tesla is open to discontinuing its Mobileye supplier deal (Tesla was quick to downplay the report).
Mon, Jan. 4, 1:54 PM
- AMD is underperforming amid a market selloff on a day in which the company has unveiled (ahead of CES) its Polaris GPU architecture. Polaris, due in mid-2016, relies on a 14nm FinFET manufacturing process, and supports high dynamic range monitors, HDMI 2.0a, 4K h.265 video encoding/decoding, and DisplayPort 1.3. AMD also promises "industry-leading performance-per-watt."
- Official details about Polaris remain limited. The architecture succeeds AMD's GCN 1.2, which underpins the company's R9 Fury GPUs (launched in mid-2015), and promises command processor, geometry processor, memory controller, L2 cache, and display engine improvements. AMD claims a Polaris-based card will consume just 85W of power to play Star Wars: Battlefront at 60fps on the medium preset, less than the 140W consumed by a card using Nvidia's (NVDA -2%) mid-range GTX 950 GPU.
- The rumor mill has indicated Polaris-based GPUs (codenamed Arctic Islands) will support second-gen High Bandwidth Memory (HBM2), and include a flagship GPU (Greenland) featuring up to 18B transistors and supporting up to 32GB of memory. Arctic Islands/Polaris is expected to be used by PC/mobile GPUs, APUs, and semi-custom chips. There's also speculation Nintendo's next-gen NX console will feature an AMD semi-custom SoC relying on Arctic Islands.
- Nvidia plans to counter Polaris/Arctic Islands with its Pascal GPU architecture, which will leverage TSMC's 16nm FinFET process.
- Last week: MKM sees Nvidia, AMD benefiting from healthy GPU pricing
Nov. 6, 2015, 4:47 PM
- The Philadelphia Semi Index (SOXX +2.6%) rallied after Nvidia (NVDA +13.9%) beat estimates and provided strong guidance (gaming GPUs led the way), Skyworks (SWKS +7.1%) offered good calendar Q4 guidance and RF chip peer Qorvo (QRVO +23.2%) posted better-than-feared results and guidance. The Nasdaq rose just 0.4%.
- Also: Analog/Ethernet chipmaker Microsemi (MSCC +4.9%) beat calendar Q3 revenue estimates and offered solid Q4 guidance: Revenue of $325M-$329M and EPS of $0.70-$0.74 vs. a consensus of $323.5M and $0.72.
- Big gainers today included specialty foundry/Skyworks supplier TowerJazz (TSEM +6%), smart TV/home automation chipmaker Sigma Designs (SIGM +16.6%), telecom/networking IC provider InPhi (IPHI +6.7%), touch controller/LCD driver supplier Synaptics (SYNA +6.1%), FPGA maker Lattice Semi (LSCC +6.6%), network processor vendor Cavium (CAVM +5.6%), DSP core IP provider CEVA (CEVA +7.2%), and analog/mixed-signal chipmakers MagnaChip (MX +4.6%) and Semtech (SMTC +5.4%).
- On its earnings call (transcript), Qorvo mentioned Chinese smartphone demand (a recent headwind) is "seeing a bit of a rebound," and that the launch of 5-mode and 6-mode Chinese 4G phones is boosting RF chip content. Qorvo also thinks Chinese base station activity (an issue for many telecom chip/component firms) bottomed in Q3, but cautions a mobile infrastructure recovery is expected to be gradual.
- Microsemi stated on its call (transcript) broadband gateway chip sales were a Q3 strong point, that telecom infrastructure began to improve, and that defense/aerospace sales are expected to rebound in 2016. Industrial demand remained soft in Q3.
- MKM's Ian Ing has upgraded Nvidia to Buy, calling shares "expensive and worth it." Ing: "We see a sustainable growth trajectory, given [Nvidia's] positioning to lead in significant paradigm changes favoring more valuable semiconductor solutions: automotive evolving from driver assist to autonomous driving, gaming transitioning to virtual reality and professional or social E-sports, and cloud computing increasingly using GPU accelerators for machine learning."
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
- Last week: Chip stocks sell off after NXP, STMicro, others issue soft guidance
Nov. 6, 2015, 9:29 AM
Nov. 5, 2015, 4:47 PM
- In addition to beating FQ3 estimates, Nvidia (NASDAQ:NVDA) is guiding for FQ4 revenue of $1.3B (+/- 2%), above a $1.21B consensus.
- Top-line performance: GPU sales continue growing in spite of a weak PC market, rising 12% Y/Y in FQ3 to $1.11B thanks to a 40% increase in gaming GPU sales. Professional GPUs (Quadro) and data center GPUs (Tesla/GRID) each fell 8%. Tegra sales fell 23% to $129M, with smartphone/tablet weakness offsetting automotive and development service growth.
- Financials: Gross margin (non-GAAP) was 56.5%, -10 bps Q/Q and +100 bps Y/Y, and in-line with guidance. FQ4 GM guidance is at 57% (+/- 50 bps). Operating expenses rose a moderate 4% Y/Y to $430M, and 4.6M shares were received through a now-completed accelerated buyback. Nvidia plans to return $1B to shareholders in FY17 (ends Jan. '17). The company ended FQ3 with $4.7B in cash, and $1.4B in long-term debt.
- Shares have risen to $29.94 after hours, making new 52-week highs. Needham's pre-earnings downgrade wasn't well-timed.
- FQ3 results, PR, CFO commentary (.pdf)
Nov. 5, 2015, 4:21 PM
- Nvidia (NASDAQ:NVDA): FQ3 EPS of $0.46 beats by $0.21.
- Revenue of $1.31B (+6.5% Y/Y) beats by $130M.
- Shares +5.12%.
Oct. 30, 2015, 10:48 AM
- Morgan Stanley has upgraded Nvidia (NVDA +2.5%) to Equal Weight, and hiked its target by $7 to $28.
- The firm had kept an Underweight rating on the GPU giant since Nov. 2013, when shares were at $15.60. Nvidia is currently within $0.50 of a 52-week high of $28.78, and trades for 24x an FY17 (ends Jan. '17) EPS consensus of $1.16.
Oct. 22, 2015, 12:24 PM
- The Philadelphia Semi Index (SOXX +3%) has risen above $90 for the first time since July on a day the Nasdaq is up 1.5%. Helping out: Texas Instruments (TXN +10.4%) soundly beat Q3 estimates, reported positive growth for its analog and embedded processing (DSP/microcontroller) units in spite of a customer inventory correction, and (with the help of iPhone content gains) provided mostly above-consensus Q4 guidance.
- Meanwhile, Cypress Semi (up 4.1%) is rallying in spite of posting mixed Q3 results and issuing light Q4 guidance. A new $450M buyback is helping.
- TI/Cypress microcontroller peers NXP (NXPI +4.2%), Freescale (FSL +3.5%), STMicroelectronics (STM +2.5%), and Microchip (MCHP +2.9%) are among the gainers. As are TI analog/mixed-signal peers ON Semi (ON +5%), Intersil (ISIL +3.2%), IDT (IDTI +3.6%), Monolithic (MPWR +3.3%), and Silicon Labs (SLAB +2.6%).
- Other notable gainers include InvenSense (INVN +2.6%), Nvidia (NVDA +3.5%), Cavium (CAVM +4.4%), Knowles (KN +3.6%), and Lattice Semi (LSCC +7%).
- On its earnings call (transcript), TI mentioned automotive chip demand (boosted by growing chip content in various systems) was strong. Industrial sales were roughly flat (better than expected), and personal electronics benefited from "demand from one customer" (likely Apple). Wireless infrastructure fell 30% Y/Y (Chinese weakness), but rose Q/Q.
- Chip stocks also outperformed yesterday after Western Digital announced it's buying SanDisk, Lam Research announced it's buying KLA-Tencor, and CPU core giant ARM (ARMH +2.7%) beat Q3 revenue estimates (EPS slightly missed) with the help of a 20% Y/Y increase in ARM chip shipments to 3.6B, and stated it expects 2015 revenue to be in-line with market expectations.
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Aug. 26, 2015, 4:21 PM
- The Nasdaq has closed its latest ultra-volatile day up 4.2%. Chip stocks, hit hard in recent weeks amid China/inventory concerns, were among the standouts (SOXX +5%) during the rally: Big gainers included Nvidia (NVDA +7.5%), Skyworks (SWKS +6.9%), Qorvo (QRVO +5.9%), Xilinx (XLNX +6.3%), Analog Devices (ADI +7.1%), Linear (LLTC +6.1%), SanDisk (SNDK +7.4%), ON Semi (ON +6.2%), and Cavium (CAVM +5.6%).
- Cybersecurity plays and various other enterprise tech names also did well. Standouts included HP (HPQ +5.5%), Palo Alto Networks (PANW +6%), Rackspace (RAX +9.8%), Red Hat (RHT +5.9%), KEYW (KEYW +8.1%), Brocade (BRCD +5.6%), ShoreTel (SHOR +5.7%), Violin Memory (VMEM +14.7%), and Rapid7 (RPD +7.2%).
- In addition to HP, tech large-caps turning in big gains included Apple (AAPL +5.7%) Microsoft (MSFT +5.5%), Google (GOOG +7.7%), and Intel (INTC +5.5%). Google benefited from a Goldman upgrade.
- KEYW announced a CEO change yesterday afternoon. HP and Brocade are adding to last week's post-earnings gains. Skyworks/Qorvo peer Avago has posted an FQ3 beat after the close.
Aug. 7, 2015, 9:14 AM
Aug. 6, 2015, 5:42 PM
- In addition to beating FQ2 revenue estimates, Nvidia (NASDAQ:NVDA) is guiding for FQ3 revenue of $1.18B (+/- 2%), above a $1.1B consensus.
- Though officially missing consensus by $0.05, FQ2 GAAP EPS would've beaten by $0.16 if not for a $0.19/share charge related to the wind-down of Nvidia's Icera 4G modem unit, and a $0.02 charge related to a Shield tablet recall.
- In spite of a very weak PC market, Nvidia's GPU sales rose 9% Y/Y in FQ2 to $959M, thanks partly to a 51% increase in gaming-related GPU sales. The high-end/high-margin GeForce GTX line was particularly strong.
- PC OEM and Quadro workstation GPU sales fell due to weak end-market demand. Tesla HPC GPU sales also dropped, something Nvidia blames on project timings. Tegra app processor sales fell 19% to $128M, as soft smartphone/tablet-related sales offset automotive growth.
- Financials: EPS received a lift from $400M worth of buybacks. Also: Gross margin was 56.6%, -30 bps Q/Q and +20 bps Y/Y, and above guidance of 55.5%-56.5%; FQ3 GM guidance is at 56.5% (+/- 50 bps). Operating expenses fell 2% Y/Y to $421M. Nvidia ended FQ2 with $4.5B in cash, and $1.4B in long-term debt.
- Shares have jumped to $22.35 in AH trading. Expectations were fairly low going in.
- FQ2 results, PR, CFO commentary (.pdf)
Aug. 6, 2015, 5:36 PM
Aug. 6, 2015, 4:28 PM
- Nvidia (NASDAQ:NVDA): Q2 EPS of $0.05 misses by $0.05.
- Revenue of $1.15B (+4.5% Y/Y) beats by $140M.
- Shares +7.8%.
NVIDIA Corp. is a visual computing company, connecting people through computer graphics. It is engaged in creating graphics chips, which is used in personal computers. The company operates through two segments: Graphics Processing Unit (GPU) and Tegra Processor. The GPU segment includes sales of... More
Industry: Semiconductor - Specialized
Country: United States
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