AI summary
Summary of article:
Huida’s first speech after Huang Renxun’s resignation will test whether financial reports, orders and prospects are still strong, and inspect the new management’s attitude towards AI financing, export controls and succession risks.
Jen-Hsun Huang After leaving Nvidia (Huida (also known as Nvidia) its first financial reporting briefing will be held after market close on Tuesday the 17th, hosted by interim CEO Colette Cress. In addition to generally expecting excellent performance, the market is also paying more attention to whether there are changes in orders, whether the growth forecast can be maintained, and whether the new management will reduce investment and financing support for AI customers.
Huida closed Friday at $162.85, down 13% on the week and more than 30% from its October high. Six key points from this financial report will test whether investors can regain confidence after the share price plunge.
Analyst estimates compiled by FactSet show that Huida’s third-quarter revenue as of October 25 will reach US$108.7 billion, an annual increase of 91%; Adjusted net income per share was US$2.47, an annual increase of 90%. HUIDA’s previous revenue forecast was US$108 billion.
Market estimates for the fourth quarter include revenue of $124.8 billion and adjusted net income of $2.74 per share. Some analysts are concerned that changes at the top level could lead to a more conservative approach by the new management.
Morningstar analyst Brian Colello is concerned about whether Huida maintains its forecast of 70% revenue growth in fiscal 2028 and its judgment that global AI spending will reach US$3 trillion to US$4 trillion in 2030.
Colello believes that capital spending by large technology companies is strong, and he would be very surprised if Huida’s performance is not as good as expected or the outlook is weak.
In the US midterm elections, several Democratic candidates advocating limiting the expansion of data centers were elected. Colello wants to see if customers hold off on orders or express concerns about slow demand. Whether the political winds have turned toward project delays and delivery adjustments is more worthy of questioning than general market skepticism.
The Wall Street Journal reported that Grace and Jen-Hsun Huang disagreed over the aggressive “revolving financing” arrangement. Huida provides financial support to customers such as new cloud companies to aid their expansion, and the funds are returned to Huida through chip purchases.
The market will ask whether existing investment, guarantee and financing commitments are maintained, whether new commitments will be reduced, and whether clients can access sufficient funding. Rising interest rates have also brought these arrangements under greater scrutiny.
Truist analyst William Stein is concerned that the U.S. Commerce Department could require stronger “know your customer” (KYC) checks, which would limit Huida’s revenue and growth. He advocated that HUIDA should ensure that its products can only be used by users who have confirmed their identity.
