If you click on a link and make a purchase we may receive a small commission. Read our editorial policy.

Nvidia stocks drop after Q3 guidance miss

Shares fall as much as 19% as company continues lower-than-expected guidance for Q4

Nvidia stock suffered a steep drop following its Q3 earnings report from where it was at close of markets yesterday. With the company missing an expected target of $3.24 billion in net revenue with actual revenue of $3.18 billion, stock dropped 15% at the start of trading today and is down a total of 19% at the time of this piece.

This is a slightly more dramatic version of a similar stock drop for Nvidia that occurred three months ago when it first gave its guidance for Q3. At the time, analysts expected the company to bring in $3.34 billion (as reported by CNBC), but Nvidia gave guidance of $3.25 billion, give or take 2%. Following this announcement, Nvidia stock dropped 6% despite better-than-expected Q2 revenue.

Q3 revenue from the company was up 21% year-over-year. Gaming revenue for the chip maker was $1.764 billion, up 13% year-over-year and down 2% from last quarter.

"Our near-term results reflect excess channel inventory post the cryptocurrency boom, which will be corrected," said Nvidia CEO Jensen Huang in a statement reported on by VentureBeat. "Our market position and growth opportunities are stronger than ever. During the quarter, we launched new platforms to extend our architecture into new growth markets - Rapids for machine learning, RTX Server for film rendering, and the T4 Cloud GPU for hyperscale and cloud."

For Q4, Nvidia has announced guidance of $2.7 billion, which CNBC says is far below the analyst estimate of $3.4 billion.

Related topics
Rebekah Valentine avatar

Rebekah Valentine

Senior Staff Writer

Rebekah arrived at GamesIndustry in 2018 after four years of freelance writing and editing across multiple gaming and tech sites. When she's not recreating video game foods in a real life kitchen, she's happily imagining herself as an Animal Crossing character.