Nvidia gets tepid reaction to forecast, boosts investor rewards
Nvidia's recent sales forecast received a lukewarm response from investors despite a significant increase in revenue from data centers. The company raised its quarterly dividend and announced substantial stock repurchases, but its outlook fell short of expectations. As competition in the AI computing market intensifies, Nvidia's shares experienced a slight decline after the announcement.
- ▪Nvidia projected sales of $91 billion for the three months ending in July, surpassing analysts' average estimate of $87 billion.
- ▪The company increased its quarterly dividend to 25 cents a share and announced $80 billion in stock repurchases.
- ▪Nvidia is facing growing competition from companies like Advanced Micro Devices and Google in the AI chip market.
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Nvidia, the world’s most valuable company, delivered a sales forecast that drew a tepid reaction from investors, even as revenue from data center operators continued to surge. Recommended Video Sales in the three months ending in July will be $91 billion, the company said in a statement late Wednesday. Though analysts estimated $87 billion on average, projections ranged as high as $96 billion, according to data compiled by Bloomberg. Nvidia also dialed up its shareholder rewards, with the company increasing its quarterly dividend to 25 cents a share from a penny. And the company announced $80 billion in stock repurchases. The outlook let down investors who have grown accustomed to Nvidia shattering expectations.
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