Bloomberg Daybreak: Asia Edition Nvidia Earnings Underwhelm Amid Global AI Build-Out
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Feb 27, 2025 Angelo Zino, Vice President of Equity Research at CFRA, dissects NVIDIA's underwhelming earnings while exploring concerns over AI spending and U.S. tariffs. Shuli Ren, Bloomberg Opinion columnist, analyzes the shifting landscape of Chinese tech stocks, presenting them as a viable alternative to the Magnificent Seven. The discussion touches on geopolitical tensions affecting the semiconductor market and the potential of Chinese EV manufacturers in a competitive sector. It's a deep dive into market dynamics and investment trends in an ever-evolving tech landscape.
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Nvidia Earnings Beat Expectations
- NVIDIA's latest earnings were better than expected, driven by strong demand for AI computing.
- Concerns about Blackwell GPU ramp-up eased due to better-than-anticipated revenue.
Gross Margin Concerns
- While NVIDIA's predicted gross margin is high, it fell short of forecasts, causing concern.
- This is expected to be a temporary dip, with margins projected to improve later.
Post-DeepSeek Demand
- Despite DeepSeek's chatbot showing LLMs can be developed cheaply, demand for NVIDIA's chips remains strong.
- Next-gen reasoning models will require significantly more compute, benefiting NVIDIA.