The onset of 2024 sparked a discussion among investors concerning the commercialization of the AI Revolution, signifying a notable shift in the tech industry comparable to the rise of the Internet in 1995, as noted by Wedbush analyst Daniel Ives.
The primary focus centered on enterprise expenditure patterns, deemed essential to validate ambitious valuations and chart the growth trajectory for the year and beyond, according to the analyst.
Recent financial calls by major technology behemoths such as Microsoft Corp [MSFT], Alphabet Inc [GOOG][GOOGL], Meta Platforms Inc [META], and Amazon.Com Inc [AMZN] highlighted an increase in investment towards AI infrastructure, indicating the commencement of AI monetization within the tech domain, as outlined by Ives.
Microsoft’s Copilot initiative surpassed expectations, underscoring strong demand for AI implementations among its customer base.
All eyes are now on Nvidia Corp [NVDA], recognized as a frontrunner in AI, as it gears up to disclose its earnings and offer guidance, as per Ives.
The tech community eagerly anticipates Nvidia’s insights, expecting another stellar performance and optimistic outlook.
Investors are particularly keen on the pace of AI spending in data centers, with Nvidia being the preferred choice for GPUs fueling generative AI applications.
Despite apprehensions regarding valuations, especially for AI-centric firms like Microsoft, Palantir Technologies Inc [PLTR], and MongoDB, Inc [MDB], many investors acknowledge the transformative potential of these tech giants and their influence on the future landscape.
Forecasts indicate a substantial surge in AI investment, with an estimated additional expenditure of $1 trillion over the next decade.
Presently, conversations predominantly revolve around enterprise-driven generative AI, while consumer-oriented AI endeavors are also gaining momentum among major players such as Alphabet, Meta, Amazon, and Microsoft.
In essence, Nvidia’s earnings report carries significant weight for both the tech industry and broader financial markets.
Analysts closely track GPU orders and enterprise demand trends, viewing Nvidia and Microsoft as primary beneficiaries of the AI Revolution, with further innovations in AI expected to surface throughout 2024.
Recently, Wedbush analyst Matt Bryson predicted fourth-quarter revenue and EPS of \(20.01 billion and \)4.48 for Nvidia.
The analyst supported these projections, citing sustained momentum in AI infrastructure spending and strong demand for High Bandwidth Memory (HBM).
Nvidia is projected to be the largest consumer of these components in 2024. Bryson also highlighted substantial capital raises for AI startups.
Price Actions: NVDA shares concluded Tuesday’s trading session down by 4.35% at $694.52.
Photo via Wikimedia Commons
Latest Ratings for NVDA
| Date | Firm | Action | From | To |
|---|---|---|---|---|
| Mar 2022 | Goldman Sachs | Reinstates | Neutral | |
| Feb 2022 | Summit Insights Group | Downgrades | Buy | Hold |
| Feb 2022 | Mizuho | Maintains | Buy |
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