u/cxr_cxr2

Bloomberg) -- Nvidia shares are down 1.4% in extended trading, after the AI chipmaker reported its first-quarter results and gave a forecast. While analysts are broadly positive, some also noted questions about the sustainability of growth, especially amid higher competition.
Read more: Nvidia Gets Tepid Reaction to Forecast, Boosts Investor Rewards
Among other movers: the VanEck Semiconductor ETF -0.4%, AMD -0.8%, Intel -0.4%, Micron -0.6%
Nvidia’s stock is up 35% off a March low, as of Wednesday’s close
Bloomberg Intelligence
“Nvidia’s signature beats across its fiscal 1Q sales and its 2Q outlook, which came in comfortably above the $90 billion buyside whisper, suggest demand and the ramp-up of its GB200 and 300 families remain solid”
The buyback, along with “reassuring commentary about Rubin’s ramp-up staying on track for 2H and a resegmentation of the Data Center segment, showcasing growth and diversification beyond top hyperscalers, should boost sentiment”
Click here for the report
Hargreaves Lansdown
“These were blockbuster results, even by its increasingly absurd standards,” and “the guide is just as eye-catching, with the top end pointing to almost 100% revenue growth in the coming quarter, and Nvidia has a habit of clearing the bar it sets for itself”
The company “still looks exceptionally well placed,” but “the question from here is not whether demand is strong today, but how long this level of growth can keep outrunning expectations”
Nvidia “might not get the plaudits it deserves in the earnings multiple, but eventually raw earnings power comes to the forefront, and that’s exactly what we’re seeing”
Citi (buy, PT $300)
The results show “robust AI demand strength”
“NVDA is adding more visibility to its Data Center sales by providing two sub-groups” and “we view this positively as it further shows the strength of NVDA’s non-hyperscale DC sales”
Wedbush
“Nvidia delivered another quarter of robust earnings beating Street expectations across the board while providing robust guidance across the board”
“We continue to believe Street estimates for Nvidia are being significantly underestimated over the next few years”
Emarketer
“Nvidia delivered another beat, but at this point that’s essentially priced in as it keeps beating quarter after quarter”
“The lingering question is whether it can convince investors the AI buildout has durability into 2027 and 2028, especially as the narrative shifts toward inference workloads and competing silicon from Google, Amazon, AMD, and Intel”
Third Bridge
“Nvidia is clearly showing no signs of slowing, and neither are its customers”
Vital Knowledge
“Nvidia continues to perform very well, but this this report is likely fully reflected in the stock’s recent rally”
“The miss on Data Center Compute revenue is (small) red flag and might raise some questions about share loss, but they more than made up for that with Networking, and the FQ2 guidance is healthy”
SECOND QUARTER FORECAST
Sees revenue $89.18 billion to $92.82 billion, estimate $87.36 billion (Bloomberg Consensus)
Sees adjusted gross margin 74.5% to 75.5%, estimate 75%
Sees adjusted operating expenses about $8.3 billion, estimate $7.93 billion
2027 YEAR FORECAST
Sees adjusted tax rate 16% to 18%, saw 17% to 19%, estimate 17.8%
FIRST QUARTER RESULTS
Revenue $81.62 billion, estimate $79.19 billion
Data center revenue $75.25 billion, +92% y/y, estimate $73.48 billion
Adjusted gross margin 75%
Adjusted operating expenses $7.45 billion, estimate $7.48 billion
Adjusted operating income $53.78 billion, estimate $52.07 billion
R&D expenses $6.32 billion, estimate $6.37 billion
Adjusted EPS $1.87, estimate $1.77
Free cash flow $48.55 billion
COMMENTARY AND CONTEXT
Sees 2Q Revenue $91.0 Billion Plus or Minus 2% :NVDA US
Moving to A New Reporting Framework With Two Platforms
Reports $80.0B Added Share Buyback Authorization
Boosts Qtr Div to 25c/Shr vs 1c/Shr
Boosts Qtrly Cash Div to $0.25/Shr
Shares Fall 2% After 1Q Earnings Report
Boosts Quarterly Dividend to 25c/Shr From 1c/Shr
Transitioning to A New Reporting Framework
Will Report Data Center & Edge Computing
Semiconductor ETF Falls 1.2% After Nvidia Results
No Shipments of Data Center Hopper Products to China
No Shipments Hopper Products to China in 1Q
Hyperscale Revenue Increased Sequentially in 1Q
Shares Turn Positive After Falling as Much as 3.2%
Corp 1Q Fy27 Compute & Networking Revenue $74,550M
Hyperscale Revenue at About 50% of Data Center Revenue
1Q Compute & Networking Rev $74.55 Billion
Corp 1Q Fy27 Graphics Revenue $7,065M
Vera Rubin on Track for Second Half of This Year
Comments in Slide Presentation
For the full year fiscal 2027, NVIDIA expects GAAP and non-GAAP tax rates to be between 16.0% and 18.0%, excluding any discrete items and material changes to NVIDIA’s tax environment.

Wall Street Journal) -- ChatGPT-maker OpenAI has been working with bankers to prepare to file for an initial public offering in the coming days or weeks, according to people familiar with the matter.
Bankers at firms including Goldman Sachs and Morgan Stanley have been helping the artificial-intelligence giant on a draft IPO prospectus it plans to file confidentially with regulators soon, possibly as early as Friday, some of the people said.
The goal is for the artificial intelligence giant led by Sam Altman to be ready to go public as early as September, some of the people said. The plans remain fluid and could still change, they cautioned.
The company cleared a major roadblock to its IPO earlier this week, when it won a legal fight with its co-founder turned Altman foe Elon Musk. Musk, whose rocket-maker SpaceX is expected to unveil IPO paperwork Wednesday ahead of a potential June offering, has said he plans to appeal the verdict.
OpenAI will have to overcome a host of other challenges, namely concerns about whether the company will be able to generate enough revenue to support its giant data-center spending commitments.
OpenAI's lead in the AI race has recently come under threat from Anthropic, which has grown faster than its rival in recent months thanks to the fast adoption of its software tools across the workforce. OpenAI is in the middle of a major strategy pivot to try and catch up.

Bloomberg) -- For years, there was only one way for mom-and-pop investors to buy into Elon Musk’s vision: shares of Tesla Inc. That’s about to change — and it’s a serious risk for Tesla investors. 
With the imminent initial public offering of Space Exploration Technologies Corp., better known as SpaceX, the market will have an additional entry point for the “Muskonomy.” Wall Street pros see investors’ attention and capital inevitably being siphoned away from Musk’s electric-vehicle maker and to his shiny new toy. 
“This cannot be a positive for Tesla,” said Joe Gilbert, portfolio manager at Integrity Asset Management. “We believe that Musk’s focus will predominantly be lasered on SpaceX. Musk has proved to be able to balance multiple initiatives simultaneously in the past, but it feels like SpaceX is his new baby at the expense of Tesla.”
Indeed, the seemingly inherent competition between Tesla and SpaceX is a key reason why Musk is reportedly considering merging the two companies.
Depending on your perspective, Tesla appears to be either in a holding pattern or slight decline, with slowing sales growth and withering fundamentals. But financial performance has never really been the driver behind the stock, which was seen as a proxy bet on Musk’s ambitions. While the shares are down8.8% this year after soaring 265% from the beginning of 2023 to the end of 2025, they still trade at about 196 times earnings over the next 12 months, the second most expensive valuation in the S&P 500 Index.

That sky-high multiple is based on investors’ belief in Musk’s ambition to transform Tesla into an autonomous vehicle and robotics company that also makes EVs. It’s a crowded field. The EV business faces competition from Chinese manufacturers abroad and traditional gas guzzlers in the US. Its robotaxis compete against Alphabet Inc.’s Waymo, which is already in operation. And numerous tech firms are working on building humanoid robot assistants.

Still, Tesla’s $1.5 trillion market capitalization dwarfs its rivals. The combined market value of Rivian Automotive Inc., Uber Technologies Inc. and Boston Scientific Corp. — among the leading competitors to Tesla’s EVs, robotaxis and robotics products — is about $250 billion.


SpaceX, however, is different for a bunch of reasons. Its business is distinct from Tesla’s, it’s the clear leader in its field and its growth potential appears boundless at the moment. 
“We expect SpaceX to come to market with an astronomical valuation, pun intended,” said Gilbert, whose firm doesn’t own Tesla because the stock doesn’t meet its value investing criteria. “It has no true competitors.” 
SpaceX may even end up with a loftier market capitalization than Tesla, according to Gilbert. “Any Musk company will always embed a call option in its valuation for vision,” he added.
Musk has long been a fascination of the retail crowd, which is comprised of ordinary investors who buy stocks on their own. But even that enthusiasm seems to be waning. Since December, when SpaceX confirmed its intentions for a 2026 IPO, the stock has seen net retail inflows of about $1 million according to data compiled by Vanda research through May 18, with roughly equal days of inflows and outflows, according to data through May 13. 
Retail investors own about 40% of Tesla shares, according to estimates by BNP Paribas analyst James Picariello. The SpaceX IPO will weigh on the stock by “‘splitting’ the pro-Musk retail shareholder base,” the analyst, who has an underperform rating on Tesla, wrote in a note to clients last month.
That said, the SpaceX IPO could also “strengthen the broader ‘Musk ecosystem’ narrative,” said Ivan Feinseth, chief investment officer at Tigress Financial Partners, which holds Tesla shares in accounts it manages for clients. 
“Tesla and SpaceX are fundamentally different businesses, and investors who believe in Musk’s vision will want exposure to both,” said Dave Mazza, chief executive officer of Roundhill Financial, which owns Tesla shares. “However, SpaceX is the new shiny object, and we expect some capital will rotate away from Tesla to SpaceX to capture the current excitement.”

It will likely take around three months for SpaceX’s impact to materialize in Tesla shares, as institutional investments shift slowly and early trading after an IPO can be messy, said Nicholas Colas,* *co-founder of DataTrek Research. Tesla also could benefit, at least initially, from its membership in the S&P 500, considering all of the passive investments that are tied to the index, Colas added. 
For most companies, a 50-50 split between present and future value is baked into the stock price, according to Colas. Tesla is different, however, because it trades far more on Musk’s dreams than the company’s actual financial performance. 

“For Tesla, it has been 90-10 future-to-present value for as long as I’ve looked at it,” said Colas, who previously worked as an auto analyst. “The vast majority of that company’s valuation is based on future hope, not current reality.”


Since that future hope hinges on Musk, it makes little sense to have two companies in the market with the same fundamental draw, Colas said, noting that a merger between them probably makes the most sense.
“If I were advising anyone, I’d be like, let’s just get all this under one roof,” Colas said. “People want to own your vision, let’s make it simple.”
Should they stay separate, however, the dynamic ultimately should benefit SpaceX over Tesla, since the former has “a more clear, competitive advantage in its core business,” he said. 
“You’ve already got this big systematically important public company, and you’re about to launch a second one,” Colas said. “I’m not sure what the value is of having two. If your pitch is, Elon runs the company, then the best approach is to have one company.”

Bloomberg) -- (Updates with details throughout.)
eBay says that following a thorough review with the support of its financial and legal advisors, the company’s Board of Directors has determined to reject GameStop’s unsolicited, non-binding acquisition proposal.
Says the proposal is “neither credible nor attractive”
Cites uncertainty regarding GameStop’s financing proposal and GameStop’s governance and executive incentives as factors

MarketWatch) -- The rolling 25-day performance for one index of semiconductor stocks has reached its highest level since March 9, 2000 -the day before the dot-com bubble peaked
The rally in semiconductor stocks is red-hot.
On Tuesday, the PHLX Semiconductor Index SOX was on track to tally its strongest 25-day rolling performance since March 9, 2000. It has risen by more than 50% during this time, according to Dow Jones Market Data.
Veterans of the dot-com bubble might remember that date: One day later, the Nasdaq Composite COMP hit its dot-com-era closing high. Over the next three years, the index would shed roughly 80% of its market value. It would take the Nasdaq 15 years to claw back those losses.
Semiconductor stocks have been climbing since this bull market began. Initially, much of the gains for the industry group were driven by one stock: Nvidia (NVDA). But since then, the rally has started to broaden out. Lately, even laggards like Intel (INTC) and Qualcomm (QCOM) have leapt higher.
See: This is the most critical question facing U.S. investors right now - and it has nothing to do with Iran
Supply bottlenecks for critical components of the artificial-intelligence buildout, like memory chips, have prompted Wall Street analysts to dramatically raise their profit forecasts for firms that design and make semiconductors of all stripes - not just the sophisticated GPUs necessary to train the top AI models. Strong earnings from the first three months of the year have helped to further cement investors' bullish outlook on the space.
Some Wall Street veterans - including Marko Kolanovic, the former top strategist at J.P. Morgan - have warned that the rally in chips names, and AI-linked names more broadly, was already looking dramatically overextended.
Over the past 25 trading sessions, every stock in the SOX index has gained 14% or more. The top three performers - Intel, Credo Technology (CRDO) and Astera Labs (ALAB) - have each gained more than 100%, Dow Jones Market Data showed.
Michael Burry - the investor who earned widespread notoriety after being portrayed in "The Big Short," the book and film about the 2008 financial crisis - said in commentary shared with his Substack subscribers earlier this week that he had bought more put options tied to the iShares Semiconductor ETF SOXX, which tracks the SOX.
Those contracts are due to expire in January 2027, Burry said.

Barron's) -- Advanced Micro Devices reported solid first-quarter earnings results on Tuesday afternoon. Its shares, up 60% this year, were rising in after-hours trading.
This is breaking news. Read a preview of AMD's earnings below and check back for more analysis soon.
Amid a shift to data center sales, buoyed by the artificial-intelligence investment boom, Advanced Micro Devices will report its first-quarter earnings on Tuesday afternoon.
In the past couple of years, expectations for AMD have been higher than they've been in some time for the chip maker. Sales and adjusted earnings per share are both seen by Wall Street analysts as rising by about a third from the first quarter of last year to $9.9 billion and $1.29, respectively. Analysts also project faster growth later this year and in 2027.
When the AI prairie fire was lit by ChatGPT in 2022, the standard kit for AI computing was Nvidia GPUs and software, and its data center sales have risen from $15 billion a year to $194 billion last year. Nvidia gear remains the most prized, but the company's customers have been looking to diversify their supply chains, and this has worked to the benefit of AMD and other chipmakers, most notably Broadcom.
AMD is the only other major GPU maker in the world, so it was natural for some of these Nvidia customers to turn to AMD, and the company has been trying hard to deliver for them, despite Nvidia starting this race with a 15-year lead in AI computing.
AMD is using pricing as a key lure, as judged by the data center segment's declining operating margins. In its two large contracts -- with Meta Platforms and OpenAI -- AMD has also given up warrants for up to 320 million AMD shares combined, which vest based on deliveries and other performance thresholds. AMD expects to begin to ship on these contracts in the second half of the year, and this will be a key test for the company as it tries to scale up quickly.
In the first quarter, analysts expect data center sales of $5.6 billion, up 53% from last year and comprising 57% of sales. Two years ago, the segment represented 43% of sales, and next year analysts see data center revenue comprising two-thirds of the total.
The company's other products for PC, automotive and industrial end markets are more cyclical income streams, but they are on an upswing, with combined first-quarter sales expected to rise by 13% from last year.
Write to Adam Levine at adam.levine@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

Bloomberg) -- President Donald Trump says the US will help some ships leave Hormuz staring on Monday morning, Middle Eastern Time.
“For the good of Iran, the Middle East, and the United States, we have told these Countries that we will guide their Ships safely out of these restricted Waterways, so that they can freely and ably get on with their business,” President Trump says in a Truth Social Post
The process is known as Project Freedom

Bloomberg) -- Major OPEC+ nations agreed a modest and symbolic increase in their June production quota levels, a delegates said, as the group sends a business-as-usual message following the surprise exit of the United Arab Emirates.
Seven countries led by Saudi Arabia and Russia will — on paper at least — add 188,000 barrels a day next month under the agreement, which was finalized at a video conference on Sunday, the delegates said. They asked not to be identified as the decision is not yet public. The increase was expected.
OPEC+ is formally continuing the process of restoring output halted several years ago, which had been in progress before the outbreak of war. OPEC+ is adjusting to the surprise loss of long-time member the UAE, which announced its departure from the organization on April 28 after years of frustration over constraints on its output.
The UAE’s move, which blindsided other members of the Organization of the Petroleum Exporting Countries and its partners, will further erode the group’s ability to influence oil prices that had already been waning because of years of output hikes from rival suppliers including US shale.
Like their scheduled hike for this month, the move is largely symbolic because OPEC nations in the Middle East will be unable to implement the increase unless the Strait of Hormuz — blocked by the US-Israeli conflict with Iran — is reopened and exports from the Persian Gulf resume. 
The UAE’s departure, which took effect on May 1, was the culmination of years of tensions between Abu Dhabi and OPEC’s de facto leader Saudi Arabia, over both oil policy and competition for regional influence. The UAE said last week that the Iran war created an opportunity for it to exit without significantly adding to market volatility.
While the departure has no immediate impact on immediate oil supply, it will mean that the UAE can ramp up supply as quickly as it chooses once the waterway reopens, unfettered by OPEC quotas, and could set the stage for future price wars.

Bloomberg) -- Berkshire Hathaway Inc.’s cash pile jumped to its highest level ever, reaching $397 billion, in Greg Abel’s first quarter as chief executive officer.

After a slight decrease late last year, the firm’s cash hoard jumped in the first quarter as it offloaded a net $8.1 billion of equity holdings in the period, the conglomerate said in a regulatory filing disclosing first-quarter results.  

Operating earnings totaled $11.35 billion, up nearly 18% from a year earlier, in the three months through March, the Omaha, Nebraska-based conglomerate said in a statement Saturday.

Wall Street Journal) -- GameStop is preparing to make an offer for eBay, according to people familiar with the matter, part of CEO Ryan Cohen's audacious plan to turn the retailer into a $100-billion plus juggernaut.

GameStop, which has a market value of around $12 billion, has been quietly building a stake in eBay's shares ahead of a potential offer, the people said. EBay is several times GameStop's size, with a market value of around $46 billion.

GameStop could submit an offer for eBay as soon as later this month, the people said.

If eBay isn't receptive, Cohen could decide to take the offer directly to eBay's shareholders, one of the people added. Details of the potential offer for eBay couldn't be learned.

Cohen has made clear he's eyeing a major transaction. He told The Wall Street Journal in late January he was scoping out potential deal targets, especially in the consumer and retail sector, as part of a plan to scale the business far beyond videogames and collectibles.

GameStop adjusted Cohen's compensation package at the beginning of the year to give him extra incentive to boost the company's market value and profitability. He stands to make as much as $35 billion in stock if certain criteria are met, including if the market value hits $100 billion, the Journal previously reported.

He has been cheered on by GameStop investors including Michael Burry of "The Big Short," whose bets against subprime mortgage bonds were chronicled in the Michael Lewis book. Burry has written in his Substack newsletter that GameStop should use its cash pile to make transformative acquisitions.

GameStop's shares have risen around 30% so far this year, in part on momentum surrounding Cohen's dealmaking plans.

EBay's shares are up more than 50% over the past 12 months as its strategy to focus on core categories including collectibles and fashion pays off. In February, eBay announced a deal to acquire secondhand fashion marketplace Depop from Etsy for $1.2 billion.

GameStop had around $9 billion in cash on hand at the end of March, up from $4.8 billion a year earlier. Cohen would likely enlist his legions of online followers to rally behind a deal, too.

Cohen, the co-founder of online pet-products retailer Chewy, gained a cult following after he built a big GameStop stake and in late 2020 criticized the company for moving too slowly toward e-commerce. He joined GameStop's board in January 2021, when the business had a market value of a little over $1 billion. He rose to become chairman later that year and vowed to turn the struggling retailer around.

Write to Lauren Thomas at lauren.thomas@wsj.com

(END) Dow Jones Newswires

Barron's) -- Sandisk reported excellent third-quarter earnings results on Thursday afternoon, but its shares were down as much as 8% in after-hours trading.

This is breaking news. Read a preview of Sandisk's earnings below and check back for more analysis soon.

Flash-storage company Sandisk has seen its stock soar by 3,300% in the last year on the back of quickly rising demand from AI data centers, tight inventories, and rising prices.

When the company reports its third-quarter earnings results on Thursday afternoon, investors will be eager to learn if it can live up to high expectations.

On average, Wall Street analysts polled by FactSet expect adjusted earnings per share above the high end of Sandisk's guidance at $14.62. That's up from a 30 cent loss last year. Sales are seen rising by 178% to $4.7 billion, and on their way to $7.8 billion next year.

Sandisk is seeing this kind of sales growth because high-speed storage chips have become crucial in artificial-intelligence servers. Just four companies -- Amazon.com, Microsoft, Alphabet and Meta Platforms -- will spend over $700 billion on new AI data centers this year, and Sandisk stands to benefit from that demand.

Like with memory chips, manufacturing capacity is being heavily strained and there are shortages, driving up prices. Both Meta and Microsoft cited component pricing as pushing up 2026 capex, and they were likely referring to the swift rise in memory and storage costs.

New capacity is not likely to be coming online until the middle of next year, so the expectation is that inventories will remain tight, and prices high.

Sandisk got an extra boost in January when Nvidia announced an additional tier of its storage technology that will be shipping inside Nvidia's new industry-leading AI servers later this year. Nvidia CEO Jensen Huang said this use of storage chips could become the largest storage market in the world.

Write to Adam Levine at adam.levine@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

Bloomberg) -- Brent oil rose to the highest since June 2022 on signs that flows through the Strait of Hormuz could be at a standstill for a prolonged period, heightening concerns over a rapidly shrinking global supply cushion.

The global benchmark rose more than 7% above $119.50 a barrel, a fresh high since the Iran war began. Prices have now erased all losses since the US and Iran agreed to a temporary ceasefire, with investors bracing for a longer conflict. 

There were multiple signs this week that point to an extended standoff between the US and Iran. Oil buyers across the world are grappling with the worst disruption to global energy supplies in history. The choking off of Hormuz is snarling about a fifth of the world’s oil flows.

Bloomberg) -- OpenAI recently failed to meet its own goals for new user acquisition and sales, fueling internal concerns that the company may struggle to support its spending on AI infrastructure, the Wall Street Journal reported.

The company fell short of several monthly sales targets in 2026 after rival Anthropic PBC gained ground in the coding and enterprise markets, WSJ reported Monday, citing unidentified people familiar with the matter.

Its ChatGPT chatbot also didn’t hit the company’s target of one billion weekly active users by the end of 2025, the newspaper said. Its subscriber defection rate remains a challenge, according to WSJ, as Google’s Gemini rose in popularity last year.



Chief Financial Officer Sarah Friar, in conversations with other company leaders, has expressed concerns that if OpenAI doesn’t increase sales fast enough, it may not be able to afford its future computing needs, WSJ said. There are growing worries among investors that AI developers and Big Tech firms are spending too much on data centers and chips for AI, with an uncertain payoff.

OpenAI alone has previously said it’s committed to spend more than $1.4 trillion on AI infrastructure. To finance those bets, OpenAI and Anthropic have increasingly tapped an overlapping group of venture funds and tech companies. In February, OpenAI raised$110 billion in its largest funding round thus far from investors including major backer SoftBank Group Corp.

Shares of SoftBank, which committed $30 billion in that round, fell as much as 7.5% in Tokyo. The latest commitment would bring SoftBank’s investment in OpenAI to $64.6 billion, for a stake of about 13%, by year-end.