Nvidia shares close at record high after forecast signals unwavering demand for AI chips

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Nvidia CEO Jensen Huang delivers a keynote address during the Nvidia GTC Artificial Intelligence Conference at SAP Center on March 18, 2024 in San Jose, California. 
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Nvidia shares jumped more than 10% on Thursday after the company on Wednesday reported earnings that topped Wall Street estimates and showed that there’s still ferocious demand for its artificial intelligence chips. The company’s data center revenue grew by a whopping427% during the quarter.

First-quarter revenue came in higher than expected at $26.04 billion compared with the LSEG estimate of $24.65 billion. And the demand isn’t wavering.

The company issued strong guidance, saying it expects $28 billion in revenue for the current quarter, beating the LSEG estimate of $26.61 billion.

Shares passed $1,000 for the first time, reaching an all-time high of $1,051.96 during intraday trading, and are up about 111% this year. Its previous high of $953.86 was set on May 21.

Despite some analysts fearing an “air pocket,” others have grown even more bullish on the company since its results. Bernstein’s Stacy Rasgon increased the firm’s price target to $1,300, writing in a note to investors that the narrative surrounding the company is “clearly nowhere near its end, or likely nowhere near its peak.” He wrote that shares seem inexpensive.

Jefferies raised its target on the stock to $1,350 due to a strong ramp for its new AI graphics processors called Blackwell and anticipation of an acceleration in “magnitude of beats” later this year when the platform launches.

Nvidia posted net income of $14.88 billion, or $5.98 per share, a dramatic pop from the $2.04 billion, or 82 cents per share, it reported in the year-ago quarter.

Nvidia on Wednesday announced a 10-for-1 stock split, with shares set to begin trading on a split-adjusted basis at market open on June 10.

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