As the shares of Nvidia surged after a strong revenue forecast, short sellers lost $826 million in mark-to-market losses on Thursday, said a report by Reuters citing data from analytics firm S3 Partners.
According to the report, S3 Partners said that bearish bets on the world’s largest chipmaker, have cost investors $11.36 billion in paper losses so far this year, neck-to-neck with Tesla as the worst performing short bet.
Shares of Nvidia rose 7.4% at $506.30 before the opening bell on Thursday.
According to a report by Bloomberg, Nvidia chief executive officer Jensen Huang has dispelled investors’ biggest concern over chip shortage.
On Wednesday, Huang said that supply will substantially increase for the rest of this year and next year.
Nvidia relies on vendors such as Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. for components.
The company was doing everything it can to stay on top of surging demand, Huang said in an interview.
“We’re focused on increasing our supply,” Huang said. “We have to do that with great urgency, and we are.”
“The big mega theme is that the world’s computer data centers are transitioning to a new model, from general purpose computing to accelerated computing,” the Nvidia CEO said.
On Wednesday, Nvidia forecast the fiscal second quarter revenue that beat expectations, boosting investors’ confidence.
The Silicon Valley-based company said its sales doubled year-on-year to $13.5 billion in the latest quarter.
It reported a net profit at $6.2 billion, 843% higher than a year ago.
The company also said it would buy back $25 billion in stock.
Nvidia Corp.’s scorching valuation are being eased every time the chipmaker reports earnings, according to a report by Bloomberg.
Nvidia’s price relative to projected profits has fallen to about 40 times after its latest projection on Wednesday. That’s down from 63 times before its May earnings, the Bloomberg report said.
In May this year, Nvidia became the first-ever semiconductor company to rack up a $1 trillion market valuation after another strong quarter.
(With inputs from agencies)
Download The Mint News App to get Daily Market Updates.
Updated: 24 Aug 2023, 10:49 PM IST