Nvidia Corp. (NASDAQ:NVDA)’s shares are up by 22% year-to-date as their performance has remained muted after posting major gains in the previous years. While the narrative for the firm surrounds the sustainability of the AI infrastructure buildout and profitability, Cramer has focused on the share price performance. The CNBC TV host has been one of Nvidia Corp. (NASDAQ:NVDA)’s biggest proponents, and recently, he has started to repeat his opinion about share buybacks. In a fresh tweet, Cramer wondered whether the firm had heeded his advice:
“I’ve been wondering if Nvidia has stepped up its buyback and is actually laying the ground work for a buyback that rivals the Apple buyback of old. Half-trillion dollar buyback will have real impact…”
Cramer, in his tweet, was referring to Apple’s share buybacks, which saw former CEO Tim Cook reduce the firm’s share count by roughly 44.5% through conducting a staggering $877 billion in buybacks. While buybacks do help the share price, they do little to affect the narrative for a firm. And for Nvidia Corp., the firm’s fiscal second quarter once again delivered a strong set of numbers focused on growth.
During the quarter, the firm’s revenue, its data center revenue and non-GAAP earnings per share grew by 106%, 117% and 120% over the year. The firm’s Q3 revenue guidance of $108 billion also beat analyst estimates of $104.86 billion and its Blackwell shipments jumped by 17% in the quarter. All-in-all, the quarter saw Nvidia Corp. post an all around set of solid figures for growth.
Yet, the firm’s third quarter gross margin guidance of 74% marked a dip from Q2’s 75%. Not to mention, the firm outlined a whopping $279 billion in supply commitments to highlight a massive structural fixed cost burden undertaken to ensure smooth AI GPU supplies. Even still, estimates, such as those from Bloomberg Intelligence, suggest that AI capex could exceed $900 billion in 2027.
Hedge fund interest in Nvidia Corp. remains as strong as ever. According to Insider Monkey’s data, 285 funds had held a stake in the firm in Q2 to make it the second most popular company in our database. On the valuation front, despite the hefty AI capex projections, Nvidia Corp.’s forward P/E ratio of 24.15 is lower than Intel’s 48 and AMD’s 30.
READ NEXT: Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.
