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NVIDIA Q4 Earnings Preview: Strong Revenue Growth Expected

NVIDIA is set to report its fiscal fourth-quarter earnings on Feb. 26. The company's revenue is projected at $37.5 billion, marking an impressive 70.7% increase year-over-year, signaling potential stock price impacts ahead.

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AI Rating:   7

Revenue Growth and Earnings Per Share (EPS)
NVIDIA's anticipated revenues for the fiscal fourth quarter are $37.5 billion with a consensus estimate of $37.72 billion, reflecting a significant year-over-year revenue growth of 70.7%. This highlights a solid demand for NVIDIA's offerings amid increasing adoption of its generative AI and cloud computing solutions.

The expected quarterly earnings are projected to be 84 cents per share, up 61.5% year-over-year from 52 cents per share in the previous year. This strong growth rate in EPS further underscores the company's robust performance and could positively influence investor sentiment.

Market Segments Driving Growth
NVIDIA's growth is expected to be driven by its Datacenter business, which is benefiting from escalating demand for cloud-based solutions as more companies adopt hybrid working models. The increasing demand for generative AI and large language models is projected to significantly boost revenue in this segment.

In the Gaming segment, there’s a positive revenue outlook based on recovering inventory levels and consistent demand for gaming products, estimated to reach $3.22 billion this quarter with a year-over-year increase of 12.3%.

The Professional Visualization segment is also showing strength with a revenue estimate of $521.1 million, reflecting a 12.6% increase year-over-year, indicating the recovery trend in positive customer engagements.

Additionally, the Automotive segment is forecasted to see revenue growth of 73.9%, totaling nearly $488.6 million, reinforcing NVIDIA's expansion in autonomous vehicles and AI cockpit solutions.

Stock Valuation
Despite NVIDIA's rapid growth, its stock is trading at a premium with a forward P/S ratio of 17.75X compared to the industry average of 14.97X. This elevated valuation may deter some investors, but could also indicate high market confidence in NVIDIA's future prospects.

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