Nvidia Blows Past Expectations as US Inflation Remains Stubborn
Nvidia's latest earnings report has sent shockwaves through the market, exceeding expectations on all fronts. The company's revenue more than doubled year-over-year to $96.2 billion, with data centre revenue topping forecasts at $89 billion, up 117% from last year.
In a surprise move, Nvidia's CFO Colette Kress offered full-year guidance for fiscal 2028, predicting a 70% increase in revenue - significantly higher than the Street's estimate of 45%. This optimistic outlook sent Nvidia's share price soaring to $220 in after-hours trading, up around 5%.
However, not all is rosy. The US inflation data released yesterday showed that prices are still rising at a rate almost double the Fed's target of 2%, with headline and core readings coming in slightly hotter than expected. While growth in the US is stalling, the Fed remains caught between slowing expansion and elevated price pressures.
As a result, markets have modestly increased their hawkish bets on further interest rate hikes, with 9 bps for September, 16 bps for October, and 22 bps implied by year-end. The focus now shifts to the annual Jackson Hole conference, where Fed Chairman Kevin Warsh is set to speak tomorrow.