The dust has settled on Nvidia's The Morning Brief

Today, we will tell you about investing in Australia. The dust has settled on Nvidia’s The Morning Brief. Let’s start:

It’s been a while since the dust settled from the most recent Nvidia ( NVDA) earnings week mania.

It’s crucial to assess what’s happening with the most important stock in the world (sorry, Apple ( AAPL)). Why? Because you must be thinking about whether the recent pullback in Nvidia could be a good buying opportunity or the beginning of a larger sell-off, as expectation expectations change.

We know that Nvidia’s margins during the first quarter of this year are likely to fall below their usual levels of strength because Blackwell AI chips ramp up. I’d argue that the market knew this before the results, therefore they were not frightened by the results insignificantly.

In Nvidia’s earnings conference call executives tried to fend off the bears who have presented an argument that there is an in-between period of digestion for AI investment by hyperscalers like Amazon ( AMZN) and that Nvidia’s margins could have reached their peak.

“Once our Blackwell fully rounds, we can improve our cost and our gross margin,” Nvidia CFO Colette Kress told reporters. “So, we expect to probably be in the mid-70s later this year.”

Also, we know fundamentally, the business of Nvidia is thriving and will remain strong.

Revenues for the fourth quarter increased by in the sequential quarter of 12% and 7% over the previous year. Data centre sales nearly doubled from the previous year. Earnings easily beat analyst expectations.

“We’re going to have to continue to scale as demand is quite high, and customers are anxious and impatient to get their Blackwell systems,” Nvidia founder and CEO Jensen Huang said.

There was no indication in the 2025 forecast or the commentary Huang did I see any indication of the idea that AMD ( AMD) is gaining Nvidia’s market share, and vice versa. Custom chips purchased from Amazon. There is no indication that hyperscalers are transferring AI chips for Nvidia or have ceased to gush over Jensen to acquire the chips they need at all prices.

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In the end, I’d argue that the information we received from Nvidia regarding margins and demand was widely known before the results. The sell-off may be a reaction that is overreacted and a result of investors trying to predict mixed guidance for the first quarter of the coming two years.

There are a handful of things that we don’t know about Nvidia that merit more attention. They are a part of the long-term bull theory.

In the beginning, Huang’s argument about DeepSeek’s R1 needing 100x more computational resources when compared to models that have been trained due to the scaling of inference times. We aren’t sure about what this signifies. However, the casual observer might see it as a sign that the market is strong on DeepSeek and there could be some positives in Nvidia projections if DeepSeek as well as other models of reasoning are gaining traction.

Another aspect we’re not aware of is the long-term implications of the technology Huang will showcase during the Nvidia GTC event on 17 March.

“We’re going to provide a big, huge step-up [in performance],” Huang stated. “And so, come to GTC, and I’ll talk to you about Blackwell Ultra, Vera Rubin, and then show you the one click after that. Really exciting new products to come at GTC.”

For me, these brand-new chips will surpass Blackwell’s performance and strengthen Nvidia’s position as the industry leader.

The final thing that’s not clear is how the nations’ expansion of AI infrastructure will affect the demand for Nvidia chips. General partner of A16z Anjney Miha suggests that the Street might underestimate the potential.

I’m not an insane Nvidia bull who is worth nothing. However, I am a keeper of common sense when it comes to studying companies, stocks, and leaders. In the case of Nvidia, it’s a mistake to believe that the information we received from the company will cause the stock to close at a lower price in 2025.

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