Nvidia Stock Drops After Q3 Earnings Highlight Midterm Margin Challenges

The post Nvidia Stock Drops After Q3 Earnings Highlight Midterm Margin Challenges appeared first on Coinpedia Fintech News

On Wednesday, Nvidia Corp. (NASDAQ: NVDA), a leading multinational tech company focused on the development of semiconductors, released results for its third quarter fiscal 2025. According to the announcement, Nvidia registered a revenue of $35.08 billion, up 94 percent from $18.12 billion a year ago.

The company highlighted that it earned $19.31 billion in the quarter, more than double the $9.24 billion it posted in last year’s third quarter. As a result, the company reported earnings per share of 81 cents, while Wall Street analysts expected an EPS of 75 cents on revenue of around $33.71 billion.

Nvidia Shareholders are Disappointed 

According to data from FactSet, Nvidia currently ranks in the third position 3 among the top semiconductor companies in terms of gross profit margins. Arm Holdings, a semiconductor company that licenses its intellectual property, has 97 percent margins.

Broadcom, a semiconductor-focused company with a bigger software business, has 76.6 percent margins. Meanwhile, Nvidia reported a 75 percent margin during the last quarter, saw margins fall slightly in its fiscal third quarter, and forecast them to fall again in the fourth quarter.

As a result, Nvidia’s shareholders have expressed midterm concerns amid heightened competition in the AI industry.

Consequently, the NVDA stock market dropped nearly 3 percent in the last 24 hours to trade at about $142.

Impact on AI-related Crypto Projects

After Nvidia reported crushing earnings estimates in the fourth quarter, the optimism in AI-related crypto projects significantly declined. Moreover, the AI-related crypto tokens have shown a significant relationship with Nvidia’s quarterly earnings.

According to the latest data, the artificial intelligence (AI) market cap dropped by nearly 6 percent to hover about $33.8 billion at the time of this writing. Near Protocol (NEAR), Internet Computer (ICP), and Render (RENDER) registered a loss of around 5 percent in the last 24 hours.

Meanwhile, Bittensor (TAO), Arkham (ARKM), and Virtuals Protocol (VIRTUAL) defied the bearish sentiment by registering gains of between 2 and 5 percent in the last 24 hours.