Nvidia has “no LPU sales in the China market today, and no China-specific LPU product in our roadmap,” the chipmaker clarified.
- Nvidia will report its Q2 results on Aug. 26.
- BMO Capital initiated coverage of Nvidia stock with an ‘Outperform’ rating and a $340 price target.
- Stocktwits sentiment for NVDA dipped to ‘extremely bearish.’
Nvidia Corp. shares rose 0.5% in early premarket trading on Friday, recovering from a sharp drop in recent days ahead of the chipmaker’s quarterly earnings report due next week.
Nvidia denied a report by The Information that it plans to begin shipping a language processing unit (LPU) tailored for Chinese customers by year-end, saying it has no China-specific version of the product on its roadmap.
“The reporting in The Information on Nvidia’s LPU is incorrect. We have no LPU sales in the China market today, and no China-specific LPU product in our roadmap,” a company spokesperson told Reuters.
The Information’s report said the speculated chip is a version of Nvidia’s LPU, a processor developed using technology licensed from startup Groq that works alongside graphics processing units (GPUs) to speed up AI chatbot responses.
Nvidia stock ended in the red for five consecutive sessions, losing nearly 4%. Shares are heading for their worst weekly performance in two months. Year to date, NVDA is up 16.4% compared to the 72% gains in the semiconductor benchmark iShares Semiconductor ETF (SOXX).
Analyst, Retail View On NVDA
BMO Capital initiated coverage of Nvidia stock with an ‘Outperform’ rating and a $340 price target, which implies a 57% upside from the stock’s last close.
Nvidia is considered a leader in complete AI systems, supported by a fully integrated technology stack and a leading supporter of large-language model ecosystems, and has made several strategic investments across leading AI companies, the research firm said in an investor note.
Much of Nvidia’s capacity sold out for the next 12-plus months, BMO added.
On Stocktwits, the retail sentiment for NVDA dipped sharply over the past week and was ‘extremely bearish’ on Friday.
“$NVDA $QQQ $SPY the NVDA doesn’t look all that great. 7 out of the past 8 days on NVDA have been gap ups. It’s why this thing won’t go down. They bid it up after hours and let it bleed during the day over and over,” said a trader.
Another trader wrote: “$NVDA expecting a pump either tomorrow or Monday. I doubt earnings will move this much either way.”
Nvidia Q2 Earnings Next Week
The market is gearing up for Nvidia’s quarterly results due next Wednesday. The AI chipmaker’s earnings have become a closely watched event, with the potential to dictate broader market direction and shape sentiment toward the AI industry as a whole.
Wall Street is expecting another beat-and-raise quarter, as accelerating cloud spending from Microsoft and Amazon and major AI commitments from SpaceX and OpenAI reinforce confidence in demand for Nvidia’s chips.
Second-quarter revenue is expected to rise 13% to $92.01 billion, while adjusted profit is seen rising 11% to $2.08 per share, per estimates from Koyfin. Investors will also track Nvidia’s gross margins as high-bandwidth-memory costs rise, along with updates on China sales and the Rubin Ultra roadmap.
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