For the eleventh consecutive quarter, earnings from Nvidia Corporation (NASDAQ:NVDA) have handily beaten analyst estimates. And while that track record has boosted Nvidia stock, which has risen a stunning 1,130% over the past three years, this round of Nvidia earnings has been greeted for a shrug.

NVDA actually is down about 3% in after-hours trading as of this writing.

Beyond simply high expectations (Nvidia stock traded at an all-time high heading into the report) it’s difficult to see what drove the negative move.

Results look strong across the board. Guidance for fiscal Q2 (ending July) was above expectations as well. In short, the bull case for NVDA still looks intact. Investors should look to take advantage of any post-earnings weakness.

Nvidia Earnings Report Explained

From a headline standpoint, Nvidia posted another spectacular quarter. Revenue of $3.21 billion rose an impressive 66% year-over-year. Even more impressively, Q1 sales have grown 150% over the last two years. Street estimates projected just $2.9 billion on the top line, a ~50% growth rate.

On the earnings front, meanwhile, Nvidia crushed it again. Non-GAAP EPS of $2.05 rose 141% year-over-year, and came in well ahead of consensus of $1.41. Gross margin rose 510 bps to a sparkling 64.7%. And while Nvidia invested in its business with a 25% increase in operating expenses, the torrid revenue growth drove leverage on that front as well.

Looking closer at revenue, the news looks just as good, with two possible exceptions. Gaming GPU growth continues to be torrid, rising 68% year-over-year and falling just 1% quarter-over-quarter despite a substantial seasonal headwind coming out of the holiday season.

Professional visualization, Nvidia’s second-smallest category, climbed 22% Y/Y. Sales in Datacenter, where Nvidia is trying to upend the dominance of Intel Corporation (NASDAQ:INTC), rose a fine 71%.

All told, the “story” behind Nvidia stock looks supported by the results. The core gaming franchise is as healthy as ever. Industry-leading margins are not only intact, they’re rising.

The massive opportunity in datacenter, driven by cloud computing solutions offered by companies like Amazon.com, Inc. (NASDAQ:AMZN) and Microsoft Corporation (NASDAQ:MSFT), is boosting growth, and Nvidia appears to be taking market share as well.

So why didn’t Nvidia earnings push NVDA higher?

Why Isn’t Nvidia Stock Rising?

Expectations were high headed into the report. Nvidia stock had gained over 20% in just 11 sessions in reaching an all-time high on Wednesday. And so to some extent, the big quarter may have already been priced in.

There’s also two modestly negative pieces of news on which NVDA skeptics may be focusing. First, Automotive revenue continues to be relatively weak. It increased just 4% year-over-year. Optimism toward self-driving cars has been cited as a long-term growth tailwind for NVDA. But the company isn’t making a ton of progress in that category of late.

The second piece of news is that for the first time, Nvidia directly disclosed its revenue from cryptocurrency mining, which it includes in its “OEM and IP” category. In the CFO commentary, the company said that category, where revenue rose 148% Y/Y, included $289 million in sales “related to GPUs for cryptocurrency mining.”

That number appears to be higher than expected. As my colleague Luke Lango pointed out in March, estimates for Nvidia’s mining revenue for fiscal Q4 ranged from $180 million to $230 million. Nvidia’s disclosed figures represent about 9% of the company’s total revenue in the quarter.

Nvidia’s crypto exposure has been a key point made by bears on Nvidia stock. With prices plunging so far in 2018, that 9% figure could shrink, providing a headwind to growth over the next couple of quarters. With NVDA trading at a still-dear 30x+ forward EPS (backing out its cash), decelerating growth could lead the stock lower.

Crypto revenue is supposed to drop, and drop sharply, in Q2, with the company saying on the Q2 conference call those sales could drop by two-thirds. And yet Q2 guidance remains well above expectations showing that Nvidia has no problem growing the rest of its business, and that it isn’t reliant on volatile mining demand.

NVDA Remains a Buy

Still, the good news far outweighs the bad here. Cryptocurrency revenue has been a nice driver for Nvidia. But the 68% growth in Gaming and the 71% increase in Datacenter revenue have nothing to do with that demand. That’s where the heart of the NVDA story lies, and the news on those fronts in the quarter is nothing but good.

As for automotive, that opportunity remains several years out; any investor expecting near-term growth was likely to be disappointed. It remains a huge opportunity, with management on the Q1 call citing a $60 billion addressable market.

And with earnings rising, NVDA stock doesn’t look that expensive. FY19 EPS estimates probably move toward $7 coming out of the quarter, implying a ~35x multiple to this year’s earnings. With growth still strong in datacenter and gaming, NVDA easily can grow into that figure as long as it keeps performing this way.

And minor concerns aside, there’s nothing in Q1 FY19 earnings to suggest that it won’t. Perhaps the stock needs a breather; perhaps investors struggle to see value in a stock that has risen 12-fold over the past three years. But there is value here.

I thought after Q4 earnings that NVDA would head to $250 – it took almost the whole three months, but it got there. After Q1, I see a path toward $300 – though based on after-hours trading, that price, too, may take some time to realize.

As of this writing, Vince Martin has no positions in any securities mentioned.