Arthur Fonzerelli has always been wearing a leather jacket. He is also very cool. You may have noticed that over the years, whether in print or on TV, whenever I nominate my favorite CEO, I always include Huang Renxun from NVDA, and the other three or four almost always include Super Micro Lisa Su's People Device (AMD). It was Jensen's turn to play last night. Huang didn't just play a grand slam, the ball hasn't fallen yet.

On Wednesday night, Nvidia announced the company's financial results for the third quarter. During the reporting period, Nvidia announced adjusted earnings per share of 1.17 US dollars and GAAP earnings per share of 0.97 US dollars, easily surpassing Wall Street in any indicator. The company generated $7.1B of revenue in three months, an increase of 50.1% year-on-year, which is also much higher than the consensus. The revenue figures set a new record, and the revenue figures of two different business lines also set new records...games and data centers.

Across the company, using adjusted data, gross profit margin expanded from 65.5% a year ago to 66.7% in the previous quarter, and then to 67% in the third quarter. Operating income increased by 70% year-on-year and 10% month-on-month, reaching $3.386B. This resulted in a 60% increase in adjusted earnings based on the already mentioned 50% revenue growth. Roll up your sleeves. Let's get to work.

Games-Revenue (new record) in the third quarter was US$3.22B, an increase of 42%, exceeding expectations. The company announced new RTX features for well-known games, as well as new RTX accelerated AI features in the Adobe (ADBE) app.

Data Center-Revenue in the third quarter (new record) was US$2.936B, an increase of 55% year-on-year, and an increase of 24% compared to the previous quarter, which is incredible. Obviously, this business also exceeded expectations. The company has announced plans to build Earth-2, an artificial intelligence supercomputer dedicated to solving global climate change. The company also announced the full launch of NVIDIA AI Enterprise, a set of software tools that enable companies running VMware (VMW) vSphere to virtualize AI workloads. The company also shared the news that the supercomputer at the National Laboratory of the U.S. Department of Energy will run Nvidia's accelerated computing program.

Professional visualization-revenue of 577 million US dollars, an increase of 144%. This number also exceeds Wall Street. The company here announced the general availability of Nvidia Omniverse Enterprise, adding AR, VR and multi-GPU rendering.

Automotive-quarterly revenue reached 135 million US dollars, an increase of 8% year-on-year. This is a place where Nvidia failed to reach a consensus. However, I think the sluggish performance here is more related to the slowdown of the automotive industry than to Nvidia. Think that autonomous driving will not only appear on consumers, but may also appear in any municipal enterprise that operates fleets within ten years? Me too. Nvidia.

Original equipment manufacturers and others-revenue here reached 234 million US dollars, an increase of 21%, exceeding market expectations. The driving force of this opaque unit is Ethereum mining, which accounts for almost half of the unit's sales.

For this quarter, the company directs revenue to $7.4B, giving or accepting 2%. This is much higher than the $6.86B that Wall Street seeks, and if accurate, it will benefit 48% growth. The company also expects the adjusted gross profit margin to be 67%, higher than the 66.4% generally expected by the market.

On Wednesday night, Chief Financial Officer Colette Kress emphasized that despite the regulatory or antitrust issues raised by the US Federal Trade Commission, the company is still committed to a proposal to acquire British chip manufacturer Arm Holding for US$40 billion. The plan is as early as September 2020. It was announced this month, as well as the British and Chinese authorities. Most of the smart people I have talked to don't seem to believe that the deal will eventually be completed. For this reason, I think the stock will be traded in the mid-term future, as if there was no trade.

No, it's not Metaverse. powerful. The jaw-dropping speech this morning was Huang Renxun's description of Omniverse last night, or rather... "Omniverse Avatar".

Huang said: "We built Omniverse Avatar to allow people to easily integrate consumer vision, speech recognition, natural language understanding, gesture recognition, facial animation synthesis, recommendation systems and other amazing technologies into one system and run it instantly. ."

In other words, Huang is describing an intelligent virtual robot that will perform many basic or repetitive functions. Huang suggests that these avatars can perform customer service, check in or check out. In his speech, Huang suggested that an avatar might cost the employer about $1,000 per year. Now, don't think like a humanitarian, but think about possibilities like a company that manages profits. Cashier. Warehouse work. fast food. What about self-driving cars? If it feels like a "taxi driver" is driving, would you feel better about your self-driving car?

Now back to the $1,000 "employee"...no sick leave, never late, never tired. There is no benefit. It's not that the suggested price will even be close to the price once it becomes a reality, but it may be much less than hiring labor and may be less error-prone. It's not that I want to make anyone unemployed, but if it comes, you might as well be prepared. Huang also suggested that we see the beginning of this future in less than five years. Now, this is deflation.

Nvidia's cash balance (cash, equivalents, ST investments) has risen sharply in the past nine months, as have current assets and total assets. Current assets are approximately eight times current liabilities. Since long-term debt has doubled, total assets are approximately 2.4 times total liabilities minus equity. The balance sheet is absolutely pristine.

Readers will see that NVDA broke the bullish flag pattern built on a flagpole in the past two weeks, which took most of October to erect. The relative intensity looks a bit too hot and has been so since late October. The same is true for the daily MACD. The full stochastic indicator is hot, but it has cooled a bit with the addition of the flag.

There are very small unfilled gaps to be aware of. In addition to the gap created this morning, there is a slight gap between $260 and $230. There will be fluctuations in the future. In other words, in addition to selling at the target price, no matter how popular this move is, I can't imagine selling the name again.

(NVDA and AMD hold shares in the Action Alerts PLUS membership club. Want to be alerted before AAP buys or sells these stocks? Learn more now.)

At the time of publication, Stephen Guilfoyle was an equity stake in Long NVDA and AMD.

Let's dig deeper-unearth the terrible underlying behavior and understand it.

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STLD looks ready for an upside breakthrough. Let's check the chart.

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But please shop later. Let's take a look at the chart of ETSY.

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