🚀 Nvidia's Rocketship

Happy Friday!

I hope you all had an amazing Thanksgiving with your friends and family. I’m thankful for all of you who actively read my newsletter and provide valuable feedback! My goal is to create the #1 visual newsletter and we are just getting started. Super excited for the next few months and 2024 in general. If you’re subscribed now, you’re definitely early.

Some key data bites from this week that you should know: 

• Binance's CEO CZ stepped down and pleaded guilty to U.S. anti-money-laundering violations, resulting in a fine of $50M.

• In October, sales of previously owned homes fell 4.1% from September, reaching a 13-year low.

• McDonald's $MCD has increased its minority stake in its China business from 20% to 48% by purchasing Carlyle's share.

• Lowe's revised guidance downward for the fiscal year to around $86B in sales, below the expected $87B - $89B.

In today’s newsletter:

• 🦾 Nvidia’s Q3 Earnings Visualized

• 💾 Data Center Race

• 🛍️ Black Friday Retail Showdown

Let’s dive right in!

🦾 Nvidia’s Q3 Earnings Visualized

Nvidia's fiscal Q3 results exceeded expectations, with earnings of $4.02 per share against the predicted $3.37, and revenue reaching $18.12B, surpassing the anticipated $16.18B. Despite this strong performance, the company anticipates a significant sales decline in Q4 in China and other regions due to export restrictions. However, Nvidia expects this decline to be offset by robust growth in other areas and is working on developing new data center products compliant with government policies.

The company continues to ramp up production of its in-demand H100 chip, leading to a forecasted $20B in overall company sales for the fourth quarter, exceeding analysts' expectations of just under $18B. Despite strong competition and new AI-focused chips introduced by companies like Microsoft, Nvidia's long-standing partnership with Microsoft continues to strengthen, exemplified by a recent deal to offer Nvidia's AI software through Microsoft's cloud service.

💾 Data Center Race

In Q3, we saw once again that Nvidia continues to retain and expand its position as the leader in the AI chip market. Data center revenue rocketed by a whopping 279% year-over-year! Despite incredible growth, the company continues to innovate with the announcement of the H200 GPU, the successor to the H100 chip, with an expected release in Q2 2024.

While Nvidia is growing rapidly, Intel and AMD aren’t seeing the same trend. Intel saw its data center revenue drop -10% and AMD saw its data center revenue remain flat. In Intel’s Q3 earnings call, CEO Pat Gelsinger said
Intel plans to advance its AI position by focusing on local AI inferencing, offering products like AI-accelerated Xeon chips and OpenVino tools. This approach aims to integrate AI across a range of platforms, from cloud and enterprise servers to edge devices.

On the other hand, AMD’s data center growth was flat but the company saw nearly 100 new cloud instances powered by their processors launched by major companies like Google, Microsoft, Oracle, and others. AMD is set to begin production shipments of their MI300A and MI300X GPUs during this quarter.

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🛍️ Black Friday Retail Showdown

Today is Black Friday. Shoppers will flock to popular retail stores like Wal-Mart, Target, Best Buy, and Macy’s, drawn by attractive deals. However, despite their popularity, these retailers have overall experienced slow revenue growth yearly. Walmart, Target, and Best Buy have only seen a slight increase in the low single digits, while Macy’s has been facing a yearly revenue decline of 1.5% on average.

Ahead of the holiday shopping season, many retailers expressed caution due to changing consumer behavior. Walmart reported a 5% rise in sales focusing more on essentials than discretionary items, and Target observed a decline in sales with consumers shifting away from big-ticket purchases towards more affordable items. The overall U.S. retail sales slightly declined in October, influenced by higher interest rates and inflation, leading to expectations of lower holiday sales growth.

Notable Companies Reporting Earnings Next Week:

• Monday:

  • Zscaler $ZS

• Tuesday:

  • Intuit $INTU, PDD Holdings $PDD, Workday $WDAY, CrowdStrike $CRWD, Splunk $SPLK

• Wednesday:

  • Salesforce $CRM, Synopsis $SNPS, Snowflake $SNOW, Dollar Tree $DLTR, Okta $OKTA, Pure Storage $PSTG, Foot Locker $FL, Victoria’s Secret $VSCO

• Thursday:

  • Dell $DELL, Marvell Technology $MRVL, Kroger $KR, Ulta Beauty $ULTA, UiPath $PATH

• Friday:

  • Genesco $GCO

All of the companies that are reporting earnings next week can be viewed here.

Buys

• Groupon ($GRPN)

  • Insider: Dusan Senkypl (Interim CEO)

    • # of Shares Purchased: 137,946

    • $ Amount: $1,343,427

    • SEC Forms: [1]

• SoFi ($SOFI)

  • Insider: Anthony Noto (CEO)

    • # of Shares Purchased: 22,500

    • $ Amount: $146,288

    • SEC Forms: [1]

Sells

• Walmart ($WMT)

  • Insider: Robson Walton (Director)

    • # of Shares Sold: 957,606

    • $ Amount: $152,303,316

    • SEC Forms: [1], [2]

• Palantir ($PLTR)

  • Insider: Alex Karp (CEO)

    • # of Shares Sold: 562,194

    • $ Amount: $11,976,710

    • SEC Forms: [1]

• Meta Platforms ($META)

  • Insider: Mark Zuckerberg ($META)

    • # of Shares Sold: 56,018

    • $ Amount: $18,963,483

    • SEC Forms: [1], [2]

🤝 Review of the Week