Nvidia (NASDAQ:NVDA) stock fell slightly in premarket trading after the chipmaker reported mixed third-quarter results yesterday afternoon. Nvidia’s overall revenue fell, but its data center business delivered impressive results. NVDA stock jumped almost 1% after markets opened today but it seems to be in for a rocky morning.
A number of investment banks were upbeat on NVDA stock in the wake of the company’s Q3 earnings.
Nvidia reported Q3 earnings per share, excluding certain items, of 58 cents, versus analysts’ average estimate of 70 cents. Its revenue fell 16.5% year-over-year to $5.9 billion, but its top line was $110 million above analysts’ mean estimate.
Also positively, Nvidia’s Q3 revenue from data centers jumped 31% versus the same period a year earlier and increased 1% compared with Q2 to $3.83 billion.
However, the chipmaker’s gaming revenue, which has likely been weighed down by the crypto collapse, tumbled 51% year-over-year and dropped 23% versus Q2 to $1.57 billion.
Matt Bryson, an analyst at investment bank Wedbush, believes that the decline of Nvidia’s gaming unit has decelerated and noted that CEO Jensen Huang expects the unit’s sales to increase slightly going forward. Bryson thinks that the gaming unit has “bottomed.”
Also positive was Piper Sandler, which expects the company’s growth to rebound. The firm kept an “overweight” rating on the shares. Finally, contending that semiconductor stocks, in general, had bottomed, Credit Suisse issued an upbeat note on the sector yesterday and identified NVDA stock, along with Qualcomm (NASDAQ:QCOM), as two of its picks in the space.
The Performance of NVDA Stock
So far in 2022, NVDA stock has plunged 46%, while the Van Eck Semiconductor ETF (NASDAQ:SMH) has sunk 32.5% during the same period. QCOM stock has also not had a great year so far and is down about 65% YTD.
On the date of publication, Larry Ramer did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.