KUALA LUMPUR, Dec 5 (Bernama) -- Bursa Malaysia closed lower on Friday amid mixed regional market performance as investors turned cautious over a possible rate hike by the Bank of Japan (BOJ) and upcoming US economic data that may influence the Federal Reserve’s (Fed) interest rate decision next week. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) pared most earlier losses to settle 4.55 points easier, or 0.28 per cent, to 1,616.52 from Thursday’s close of 1,621.07. The benchmark index, which opened 0.37 of-a-point lower at 1,620.70, moved between 1,609.67 and 1,621.25 throughout the day. The broader market was negative, with decliners outpacing advancers 604 to 439. A total of 550 counters were unchanged, 1,151 untraded, and 18 suspended. Turnover declined to 3.17 billion units worth RM2.24 billion from 4.48 billion units worth RM2.75 billion yesterday. Rakuten Trade Sdn Bhd vice-presiden...
Earnings Snapshot
Q2 FY26 Revenue: US$46.7B (+56% YoY), above expectations.
Q3 Guidance: Midpoint US$54B vs consensus US$53.4B.
Stock Reaction: Fell modestly (~–2.5% after hours) on profit-taking and China uncertainty.
Valuation: ~32x forward earnings, with 50% EPS growth expected this fiscal year.
China: The Big Headline Risk
Nvidia reported no sales of H20 GPUs to China in Q2.
The company also excluded H20 shipments from Q3 guidance.
Background:
U.S. initially blocked H20 exports, then reversed with licensing.
China discouraged orders after political tensions.
CEO Jensen Huang: discussions with Beijing are ongoing; “no backdoor” exists in H20 chips.
Potential upside: Nvidia estimated up to US$8B in lost Q2 sales without regulatory hurdles.
Takeaway: China is noise. Any recovery in H20 or future Blackwell shipments would be upside, not baseline.
The Real Growth Driver: Rack-Scale AI Systems
Nvidia’s future lies in NVL72 rack servers:
Composition: 72 GPUs per rack (vs 8 previously).
Use Case: Training & inference for next-gen AI models requiring exponential compute power.
Cost: Several million dollars per rack.
Ramp Evidence:
Networking revenue surged +46% QoQ in Q2, reflecting higher demand for rack-scale systems.
Big Tech continues to expand AI capital expenditure budgets.
Huang: NVL72 “delivers an exceptional generational leap” in performance just as demand for reasoning AI models accelerates.
Long-Term View
Nvidia’s fundamentals remain exceptionally strong despite volatility.
Key catalysts:
NVL72 and GB300 ramp through FY26.
Networking revenue as a secondary growth engine.
Potential eventual resolution in China.
Investor strategy: Focus on long-term AI adoption cycle, not short-term geopolitical noise.
Bottom Line
Nvidia’s valuation (32x forward earnings) is not stretched given its growth profile. With AI infrastructure demand outpacing supply, multiple quarters of strong results are likely ahead.
Verdict: Hold for the long term. Any China rebound is a bonus.
Comments
Post a Comment