Soaring sales, healthy fat profits... Simply not good enough, Nvidia Nvidia continues to ride the AI hype wave, raking in $2.17bn in sales in three months – its best quarterly results yet, apparently. Jen-Hsun Huang, CEO and cofounder of the graphics chips biz, told investors and analysts on a conference call on Thursday “we’re at the beginning of an AI computing revolution.” Well, at least he' …
"That beat analyst expectations"
"they were hoping Silicon Valley-based Nvidia would surprise them with more"
There really seems to be something seriously wrong with pretty much everyone involved in the stock market. Usually it's everyone complaining that a successful company wasn't quite as successful as had been predicted by some random who didn't have clue what they were talking about, but this time Nvidia did even better than everyone had predicted and the stocks still drop because they didn't beat those unfounded expectations by enough. They may as well just use a random number generator to decide what stocks are worth, there's almost never any connection to actual business results anyway (see also Twitter and Snapchat as great examples of companies who are somehow considered to be worth more than zero despite happily announcing that they've never made any money and never will).
a share in a company is just that, a share (although usually a very small share).
The value of such a share, is not just the pile of "whatever" it is sitting on today, but also the expected amount of "whatever" that the company will be expected to find/produce/develop/earn tomorrow, the day after, and years from now. It also includes such things and "stuff" that it owes other companies and banks.
Financial Analysts try to predict what people (individual investors, funds, traders, etc) will be willing to pay at a given point in the future (a financial analyst predicting the current share price wouldn't be much use), given what they know of the size of the current pile, and the expected growth/shrinkage of that pile. And also what kind of crazy is in the head of the market traders at that point in history (are they pessimistic or optimistic about the future - will a fall in shareprice cause lots of people wanting to buy, because they think they will make more money when the shareprice jumps up again, or will more people want to sell than buy, because most of them thinks that this is it, the shareprice will be heading south for years based on such things as the direction of the economy, joining or leaving trade blocks, competing technologies, etc).
However, people with their many reasons for buying and selling shares don't always behave the way that the analysts predict, and sometimes the underlying assumptions that the analysts calculate from are also wrong. (In fact, any individual investor who reads up on current value and future value and decides that a share will likely be worth more or less in a months time than it is now, are themselves an analyst).
In this case, we knew the size of the pile from a few months ago, and financial analysts thought they had a rough idea as to how much the pile had grown since then. turns out, they were very close in guessing. Meanwhile however, investors had gone ahead and assumed that the pile was actually even bigger. And they (the market) had been buying and selling shares under the assumption that it would be bigger (some thought it would be less, some thought it would be more, and averaged out they thought bigger than it turned out to be).
When it turned out that the analysts were roughly on the ball, but that the market price (set by the sellers and buyers of said share) had been a bit too optimistic, the share price "self-corrected" to be in line with what the actual value of a share was (this "self-correcting" is what the market does - its what makes prices go up and down). You could argue that the "actual" value of the share was always correct - as it always had and always will include assumptions of the future, but I digress.
That is the (very simplified) reason why the shareprice went down, despite the company roughly meeting analysts predictions.
blah, blah, blah, "That is the (very simplified) reason why the shareprice went down"... blah, blah
You know you didn't do anything to make any case for any reason. Your long-winded "simplification" stands on its own. Stock price fluctuations are based on mostly nonsense and horseshit, with a few pretend-president tweets thrown in to make the great investor lemmings all head towards the same cliff. The reason the stock price didn't go up is that Nvidia didn't also slash tons of jobs while making that profit. THAT'S that kind of fucked up illogical (mental) mentality that stock market lemmings, excuse me, "investor/analysts" get money-boners about. People with more money than sense invest. Smart people make things that people want. There is a YUGE difference.
Yet people treat stocks as some sort of magical money machine, when in reality it is really lemmings all moving their money one way or the other, based on zero info in most all cases. Stock market business algorithms and code don't predict the future, they collect a bunch of data and guess which way the market will head in microsecond time windows and does its "good work" that way. There is nothing to it other than surrounding that bit of logic with a bunch of risk aversion techniques and some coffee machines and cute secretaries. There is NOTHING more to it than that. And if you think there is, wow, what a dumbfucker you must be. Sorry, that's the truth. Get used to it, the stock market is a lot of smoke and mirrors and money moving by people who don't have any value in and of themselves, nor any idea how to build products or services of value themselves. Fucking sad lot of tossers.
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