I think its hard to predict what growth rate NVDA can do, because we don’t know what the gaming growth rate was without Crypto, so we can’t use the past growth rate to predict. Management doesn’t know either.
At the 2nd Quarter conference call they said inventory was fine, they were not going to plan for the $100M of crypto sales going forward. Turns out the crypto sales were much higher than that and part of the gaming sales where going to crypto and they lower their forecast next Q by $700 M.
So now we have the growth rate going from 40%—>21%----> to -7% next quarter.
Here are the questions I’m asking myself on NVDA.
If management just missed their gaming center demand by $700 M last quarter, how confident can I be that they have the inventory problem solved at the end of this quarter and it won’t carry forward?
Data center demand missed forecasts. Is that caused by crypto also?
What is the real growth rate for gaming, and the company, without crypto?
When is the auto business going to kick in and become another growth driver?
I can’t answer any of the questions above, so I can’t determine how likely it is that they grow 25%+ going forward.
NVDA is clearly a great company, with a management team that has been great in the past but just stubbed their toe pretty bad.
Jim