Nvidia's Blowout Earnings Spark Mixed Reactions Among Asian Suppliers
Nvidia's blowout earnings have sent mixed signals to its Asian suppliers. The chip maker's shares rallied over 5% in aftermarket trade after it reported a strong quarter with $96.2B revenue and guided Q3 guidance of $108B.
The reaction among Asian suppliers was varied, with Korean memory names such as SK Hynix and Samsung Electronics surging by +3.55% and +2.49%, respectively. In contrast, Taiwanese equipment makers ASE and Advantest sold off by -1.27% and -2.18%, respectively.
Nvidia's guidance for Q4 gross margins was down to 71-72%, but expected to recover towards 72-73% in FY2028 as higher memory prices take effect. This margin compression is a signal that equipment makers may face capex caution from hyperscalers funding the buildout.
Advantest, which makes GPU test systems used by Nvidia, fell hardest with a -2.18% drop. The stock had already risen +3.63% on August 26, pricing in a beat before earnings were announced. Advantest's decline may be due to the margin compression signal suggesting that Nvidia is slowing its pace of incremental capacity additions as it works through existing orders.