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- 📈 Nvidia's 78% Revenue Surge
📈 Nvidia's 78% Revenue Surge
Lilly to invest $27B in U.S. plants, Teladoc stock falls 10%, Salesforce misses on revenue, Paramount skids to a loss, Nvidia sales grow on AI demand
Evelio Silvera
February 27, 2025
Good morning.
⚡ The Fast Five → Lilly to invest $27B in U.S. plants, Teladoc stock falls 10%, Salesforce misses on revenue, Paramount skids to a loss, Nvidia sales grow on AI demand
🔎 Market Trends → S&P 500 ends barely changed; Nvidia shares up after the bell; US Futures Hold Steady After Nvidia Earnings Report
And now…
⏱️ Your 5-minute briefing for Thursday, February 27, 2025:
MARKET BRIEF
Before the Open
As of market close 02/26/2025.
Pre-Market
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Fear & Greed
Markets in Review
Markets Stall as Housing Wobbles, Tesla Tumbles
The Nasdaq edged up 0.3% to 19,075.3, while the S&P 500 held steady at 5,956.1. The Dow slipped 0.4% to 43,433.1. Tech stocks led the way, while consumer staples lagged.
The Big Picture:
Housing data threw a curveball. New-home sales fell more than expected in January, weighed down by rising prices and lingering mortgage rate uncertainty. Oxford Economics sees downside risks from potential tariffs on building materials and stricter immigration policies affecting labor supply.
Meanwhile, mortgage applications declined for a second straight week, despite a dip in 30-year mortgage rates to their lowest since December. Treasury yields softened, with the 10-year yield down four basis points to 4.26% and the two-year slipping two basis points to 4.08%.
Energy markets saw minor movement, with WTI crude dipping 0.2% to $68.79 a barrel. Precious metals continued to shine, with gold up 0.5% to $2,932 per ounce and silver gaining 1.2% to $32.51 per ounce.
Market Movers:
Tesla (TSLA) fell 4%, extending its losing streak to five days. European January deliveries plunged 50% year-over-year, raising concerns over its 2025 growth guidance.
AppLovin (APP) slid 12% after short sellers Fuzzy Panda Research and Culper Research issued separate reports questioning the company’s financial practices.
Axon Enterprise (AXON) surged 15%, leading the S&P 500 after delivering stronger-than-expected Q4 earnings.
Intuit (INTU) jumped 13%, boosted by surprising gains in QuickBooks and Credit Karma, which drove revenue past expectations.
What They’re Saying:
"Housing remains a wildcard for economic growth, and its trajectory will depend largely on mortgage rates and supply constraints," Oxford Economics noted.
WHAT WE’RE WATCHING
Events
Today: Bureau of Economic Analysis - GDP Second Release - 8:30am
Why You Should Care: It's the broadest measure of economic activity and the primary gauge of the economy's health.
Today: Department of Labor - Unemployment Claims - 8:30am
Why You Should Care: Although it's generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health because consumer spending is highly correlated with labor-market conditions. Unemployment is also a major consideration for those steering the country's monetary policy.
Earnings Reports
Today: Dell, Monster Energy, HP (Hewlett-Packard), Warner Bros. Discovery, Rocket Mortgage, Telefonica, Duolingo
Tomorrow: Pearson, fuboTV, Sphere Entertainment Co., Chart Industries
MARKET BRIEF
Leading News
AI Money Machine: Nvidia's Blackwell Bonanza Propels 78% Growth
Photo Credit: Ann Wang | Reuters
Why it matters:
Nvidia's ($NVDA) stellar earnings showcase the company's continued dominance in AI chips while early Blackwell sales signal the next growth wave is already underway.
Zoom Out:
The AI gold rush continues to fill Nvidia's coffers. Revenue surged 78% year-over-year to $39.33 billion, handily beating Wall Street's expectations of $38.05 billion. For perspective, Nvidia's full fiscal year revenue reached an eye-popping $130.5 billion, more than doubling (+114%) from the previous year.
While growth is naturally decelerating from the stratospheric 262% rates of early 2024, the company's confident Q1 guidance of $43 billion suggests this AI juggernaut still has plenty of runway.
Key Insights:
Data center revenue now represents 91% of total sales, up from 60% just two years ago — a remarkable transformation into an AI-focused enterprise that's captured the vast majority of the AI accelerator market.
Blackwell momentum is building rapidly, with $11 billion in sales already, representing "the fastest product ramp" in company history. CEO Jensen Huang noted that cloud providers account for approximately 50% of data center revenue.
The inference opportunity may dwarf training. CFO Colette Kress noted that "long-thinking, reasoning AI can require 100 times more compute per task" — suggesting the AI computing revolution is still in its early innings.
Market Pulse:
"Just because the chip is designed doesn't mean it gets deployed," Huang remarked, dismissing concerns about custom chips from tech giants potentially threatening Nvidia's position.
Bull’s Take:
While Nvidia shares trade at lofty valuations, the expanding AI inference market presents a multiplier effect that could justify current prices. Smart investors should consider looking past short-term volatility to the long-term compute transition that's redefining not just tech, but the entire economy.
Headlines
Lilly plans to invest $27 billion in new US plants as Trump threatens pharmaceutical tariffs (link)
Teladoc Health Stock Falls 10% on Loss and Weak Outlook (link)
Salesforce misses on revenue, issues disappointing guidance (link)
Paramount skids to a loss but says merger expected to close in first half as expected (link)
AI’s power demands spark new joint GE Vernova–NRG electricity plant project (link)
Amazon unveils revamped Alexa with AI features (link)
CRYPTO
Fear & Greed
Headlines
DAILY SHARE
On the Socials
*Hat-tip to dougboneparth