2019 Q3 Nvidia Results - Ouch!

Investment Analysis Clubs Saul’s Investing Discussions
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There’s really only one thing you have to know about the stock’s price action over the next 90 days. From the press release:

“Our near-term results reflect excess channel inventory post the crypto-currency boom, which will be corrected. Our market position and growth opportunities are stronger than ever. During the quarter, we launched new platforms to extend our architecture into new growth markets – RAPIDS for machine learning, RTX Server for film rendering, and the T4 Cloud GPU for hyperscale and cloud.”

Yeah, next quarter’s guidance for $2.7B is deadly. Crypto strikes again! Short term issue though, guys. Think long-term, thesis should still be intact though I am sure we will know more after going through the conference call.

Here are the numbers:


Revenue (billions)		Q1		Q2		Q3		Q4
2017				1.31		1.43		2.00		2.17
2018				1.94		2.23		2.64		2.91
2019				3.21		3.12		3.18	

EPS (non-GAAP)		        Q1		Q2		Q3		Q4
2017				0.46		0.53		0.94		1.13
2018				0.85		1.01		1.33		1.72	
2019				2.05		1.94		1.84

2019 Q3 Earnings:

Revenue Growth (billions)
2018 Q3 TTM Revenue = 8.98
2019 Q3 TTM Revenue = 12.42
YOY TTM Revenue Growth = 38.3%, previous quarter growth 42.4%

EPS Growth (non-GAAP)
2018 Q3 TTM Earnings = 4.32
2019 Q3 TTM Earnings = 7.55
YOY TTM EPS Growth = 74.8%, previous quarter growth 79.1%

P/E (Check Current Price) = 202.39/7.55 = 26.8
Trailing 1Y PEG = 26.8/74.8 = 0.36

Datacenter revenue $792M, up 58%
Gaming revenue $1.76B, up 13%
Professional visualization revenue $305M, up 28%
Automotive revenue $174M, up 19%


Gross Margin (non-GAAP)	        Q1		Q2		Q3		Q4
2017						58.1		59.2		60.2	
2018				59.6		58.6		59.7		62.1
2019				64.7		63.3		60.4

Data Center Revenue (mil)	Q1		Q2		Q3		Q4
2017								240		296
2018				409		416		501		606
2019				701		760		792

Gaming	Revenue (mil)		Q1		Q2		Q3		Q4
2017								1244		1348
2018				1027		1186		1561		1739
2019				1723		1805		1764

Pro Visual Revenue (mil)	Q1		Q2		Q3		Q4
2017								207		225
2018				205		235		239		254
2019				251		281		305

Automotive Revenue (mil)	Q1		Q2		Q3		Q4
2017								127		128
2018				140		142		144		132
2019				145		161		172

Matt
Long NVDA (about 5% – though it will be smaller tomorrow!)
Phoenix 1 Contributor
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See all my holdings at http://my.fool.com/profile/TMFCochrane/info.aspx

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P/E (Check Current Price) = 202.39/7.55 = 26.8
Trailing 1Y PEG = 26.8/74.8 = 0.36

Just one quick tweak to the trailing 1YPEG calculation:

Using the current after-hours price of $169.20, you get 169.2/7.55 = 22.4…22.4/74.8 = 0.2996

Still, looks like it may be late-spring before this transitory issue might be behind them.

-volfan84

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Data center revenue has slowed down to 58% yoy. Is there an explanation? I don’t own NVDA but was close to buying after raising cash, but tough comps for the next few quarters gave me pause. And the reason I’d be interested is the ai/datacenter aspect.

It was about this time last year the bitcoin craze was in full force.

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Question about mid-range gaming GPU inventory, and the potential impact of seasonal weakness in early 2019.

Huang: We were expecting gaming GPU demand to grow as prices that were inflated by crypto demand fell. But prices took longer than expected to fall, and demand took longer than expected to grow. But now that pricing has stabilized, we’re optimistic things will improve.

Notes Nvidia chose not to sell its mid-range GTX 1060 GPU into the channel this quarter to bring down inventories.

Kress notably indicates Nvidia expects sales to improve in FQ1 in spite of traditional seasonal weakness.

Dominic
long NVDA

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I don’t know how useful trailing PEG is when revenue is falling this sharply. Probably not at all is my guess.

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I don’t know how useful trailing PEG is when revenue is falling this sharply. Probably not at all is my guess.

I agree, Najdorf. It’s just something I track. But the guidance here is key, not trailing anything.

Matt
Long NVDA

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