Wall Street Breakfast Podcast: Nvidia Soars On Q2 Earnings

Chipmaker NVIDIA

Justin Sullivan

Listen below or on the go on Apple Podcasts and Spotify

Nvidia (NVDA) pops as Q2 earnings, guidance smash estimates; unveils $25B buyback. (00:27) Jerome Powell at Jackson Hole: Expect push-back on rate cuts, bond yield comments. (01:41) Boeing (BA) sees new production issue on 737 MAX – report. (02:53)

This is an abridged transcript of the podcast.

Nvidia (NASDAQ:NVDA) is up more than 8% premarket after the semiconductor company reported second-quarter results and guidance that smashed expectations.

For the period ending July 31, Nvidia (NVDA) earned an adjusted $2.70 per share on $13.51B in revenue. A consensus of analysts were expecting the company to earn $2.09 per share on $11.09B in revenue.

Data center sales surged to a record $10.32B, well above the $7.98B that analysts were looking for.

Adjusted gross margins were 71.2%, above the 70.1% estimate.

Looking ahead, Nvidia (NVDA) said it expects third-quarter sales at $16B, plus or minus 2%, well above the $12.5B that analysts were expecting.

In a note to clients, Wedbush Securities analyst Dan Ives called it the “guidance heard around the world,” citing the “jaw dropping demand.”

In addition, Nvidia approved $25B in share buybacks and said it would continue to buy back stock this fiscal year.

Following the results, AMD (AMD), Broadcom (AVGO) and several other chipmakers rose in after-hours trading. Microsoft (MSFT) shares also rose on the back of the strong results.

Today is day one of when monetary policymakers will gather at the Kansas City Fed’s annual economic symposium at Jackson Hole, Wyoming.

This year’s theme is “Structural Shifts in the Global Economy.”

Of course, the highlight is usually the Federal Reserve chair’s speech. Jerome Powell is set to speak on Friday at 10:05 AM ET.

Given the large gap between July’s FOMC meeting and September’s — eight weeks instead of the usual six to seven — investors will be eager to hear if Powell’s views on the economy have shifted since the Fed’s last meeting.

Lexi Cantor from Goldman Sachs’s Economic Research team isn’t expecting strong signals from the Fed on monetary policy. With July PCE inflation and the nonfarm payrolls report coming out after the Jackson Hole meeting, Cantor says “the Fed will likely wait to be informed by these new data before changing their current posture,” she wrote in a note to clients.

SA Analyst Gary Gambino anticipates that Powell “will probably restate its intent to keep interest rates high for an extended period to make sure inflation does not flare up again.”

Boeing (NYSE:BA) has identified a manufacturing issue with its 737 Max.

The issue is that there are hundreds of incorrectly drilled holes on the aircraft.

According to The Air Current, the issue involves the structural assembly of a bulkhead, a job that is done by Spirit AeroSystems.

Boeing (BA) confirmed to the publication that it has figured out a fix, adding that the current working fleet of Max aircraft is not impacted.

However, the problem will lead to at least some near-term delivery delays.

Other headlines to look out for on Seeking Alpha:

LVMH, Ferrari, Ralph Lauren, Mercedes-Benz are listed in the new Luxury ETF: LUXX

SpaceX reportedly working with Cloudflare to boost Starlink

CVS Health launches biosimilars business, with Humira rival as first product

Wall Street’s major averages on Wednesday jumped.

The Nasdaq (COMP.IND) added 1.59%. The S&P 500 (SP500) gained 1.10%. The Dow (DJI) underperformed the other two indexes, rising 0.54%.

All 11 S&P sectors – with the exception of Energy – ended in positive territory, with Communication Services and Tech up around 2% each.

Treasury yields retreated significantly.

The 10-year yield (US10Y) was down 14 basis points to 4.19%, while the 2-year yield (US2Y) was down 8 basis points to 4.96%.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are mixed. The Dow is down 0.1%, the S&P 500 is up 0.5% and the Nasdaq is up 1.1%. Crude oil is up 0.4% at more than $79 a barrel. Bitcoin is up 1.8%.

In the world markets, the FTSE 100 is up 0.4% and the DAX is up 0.3%.

The biggest stock movers for the day premarket: Guess? (NYSE:GES) is up more than 13% as Q2 results exceeded expectations and the outlook for FY2024 improved.

Groupon (NASDAQ:GRPN) is up more than 12% after the company topped the consensus mark in Q2.

Autodesk (NASDAQ:ADSK) is up more than 6% after the company outperformed expectations in Q2 and provided a positive outlook.

On today’s economic calendar, at 830 am initial jobless claims. Also at 830 am the Chicago Fed national activity index.

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