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Dell Technologies reported fiscal third-quarter earnings that exceeded expectations for earnings per share but fell short on revenue, leading to a 10% drop in shares after hours. The company forecasted fourth-quarter revenue between $24 billion and $25 billion, below analyst expectations, despite a 34% revenue increase in its Infrastructure Solutions Group driven by AI sales. Demand for AI systems remains strong, with a $4.5 billion pipeline of future orders, as customers await Nvidia's next-generation Blackwell chips.
UBS has initiated coverage of Arm Holdings PLC with a Buy rating and a price target of $160, citing strong demand for its IP in AI and cloud computing. Despite a solid Q2 earnings report, concerns linger over license revenue and legal risks from its Qualcomm lawsuit, which could impact future sales. Arm's high valuation ratios reflect growth expectations, but competition and regulatory uncertainties pose challenges to its market position.
Nvidia shares fell 3.21% in premarket trading after the company reported third-quarter earnings that, despite beating expectations with $35.08 billion in revenue (up 94% year-on-year), indicated a slowdown in growth compared to previous quarters. This decline affected other chipmakers, with Intel, Qualcomm, and AMD also experiencing losses. Analysts remain optimistic about Nvidia's future, particularly with the anticipated launch of its next-generation chip, Blackwell, amid strong demand.
Shares of Nvidia and AMD are trending in opposite directions, prompting Jim Cramer"s insights on both AI chip stocks. Investors are keen to understand the implications of these movements in the tech sector as competition intensifies.
U.S. inflation rose to 2.6% in October, complicating the Federal Reserve's easing path as it exceeds the 2% target. Markets reacted mixed, with the S&P 500 and Dow slightly up, while Nasdaq fell. AMD announced layoffs of 1,000 workers to strengthen its AI chip position amid rising competition. As President-elect Trump prepares to take office, his potentially inflationary policies could challenge the Fed's plans for rate cuts, leading to a "higher for longer" interest rate environment.
AMD will lay off approximately 1,000 employees, or 4% of its workforce, as it aligns resources with growth opportunities amid increasing AI competition. Despite strong performance against Intel in the x86 market, AMD faces challenges in the AI chip sector, lagging behind Nvidia. The company anticipates $5 billion in AI chip sales this year, while its stock has declined, contrasting with Nvidia's significant market gains.
AMD
Companies
| Symbol | AMD |
| Name | Advanced Micro Devices, Inc. |
| Currency | USD |
| Sector | Information Technology |
| IndustryGroup | Semiconductors & Semiconductor Equipment |
| Industry | Semiconductors & Semiconductor Equipment |
| Market | NASDAQ Global Select |
| Country | United States |
| State | CA |
| City | Santa Clara |
| Zipcode | 95054 |
| Website | http://www.amd.com |
The information provided herein is generated by experimental artificial intelligence and is for informational purposes only.
Dell shares drop on weak forecast despite strong AI sales growth
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22:07 26.11.2024
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16:27 25.11.2024
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