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Market watchers might be perplexed by the seemingly contradictory moves of Nvidia’s shares in extended trading.
The company beat expectations for its second-quarter results, and its forward revenue guidance also surpassed expectations. A stock buyback was also announced, but the stock fell.
The reason? Data center revenue, which serves as a proxy for the company’s AI prospects, came up short of estimates.
Nvidia’s growth in recent years has been fueled by its data center business, which focuses on graphics processors, or GPUs, and related products that link and scale them for large deployments. Revenue from the division rose 56% from a year earlier to $41.1 billion, slightly below the $41.34 billion estimate from StreetAccount.
