(Bloomberg) — U.S. stock futures fell after Nvidia Inc. posted a revenue outlook that missed analysts’ best estimates, potentially adding to concerns about the sustainability of the artificial intelligence boom.
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As of 12:34 pm Hong Kong time on Thursday, Nasdaq 100 Index futures were down 0.6% and S&P 500 Index futures were down 0.3%, both paring losses from the previous day. Semiconductor-related stocks led Asia's major stock indexes lower.
Despite a recent recovery, the Nasdaq 100 Index is still down from its all-time high as investors try to determine whether this year's big rally in AI stocks far outweighs the real benefits the technology promises. At the same time, hopes of lower interest rates are driving capital out of technology and into struggling sectors.
Nvidia shares fell more than 8% in after-market trading, also weighed down by the company's announcement that production of its new Blackwell chips would be disrupted.
While the market may be disappointed that the chipmaker's results weren't as spectacular as previously reported, “this is likely just short-term noise” amid continued fundamental strength, Vital Knowledge's Adam Crisafulli wrote in a note. The slowing growth “is simply the result of a very difficult comparison, one the whole world is aware of.”
The selloff in U.S. stocks ahead of Nvidia's earnings release on Wednesday suggested investors were bracing for a negative surprise. Futures, which fell from intraday lows, may suggest continued optimism about the chipmaker's outlook will limit further declines.
Nvidia management's assurance that Blackwell's chips will bring in “billions of dollars” in revenue in the fourth quarter “is significant and should dispel much of the bearish talking points surrounding worst-case scenarios,” TD Cowen analyst Matthew Ramsey wrote in a note. “But formal guidance for the January quarter will likely be needed to truly settle the debate.”
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