TOP STORY
🚀 Nvidia Shatters Expectations with 265% Revenue Surge

Everyone held their breath on Wednesday as Nvidia, which some are saying is propping up the entire tech sector, reported earnings.

Investors were not disappointed, with the stock rising 18% after reporting a staggering 265% increase in quarterly revenue and a 769% increase in net income from last year, blowing away analyst expectations:

• ✅ Revenue: $22.10B vs $20.62B expected

• ✅ Earnings: $5.16 per share vs $4.64 expected

Fuelling the fire, Nvidia projected a further 9% increase in revenue for Q1, expecting $24B in sales.

📊 Data Centre Business Grows to 83% of Revenue

Why the surge? Well in case you’ve been living under a rock - Nvidia manufactures the chips needed to develop and run ChatGPT, Bard, Grok, and basically every AI application.

Nvidia’s Data Centre Business, which was only 45% of revenue in Q1 2022, now accounts for 83% of revenue 🤯

Revenue from Nvidia’s Data Center business has soared 409% to $18.40 billion in the past year.

As major companies like Alphabet and Meta, alongside startups like Anthropic and Cohere, develop increasingly advanced language models, demand for Nvidia chips will continue to rise.

🇨🇳 Challenges in China

Nvidia's biggest challenges have been China after the US placed restrictions on exporting some of its advanced AI chips under the guise of ‘stopping Beijing from receiving cutting edge US tech to strengthen its military’.

Nvidia has adapted by introducing specific chips for the Chinese market, but many Chinese Cloud Service Providers say they are ‘not interested’ in downgraded chips.

Right now around 80% of the high-end AI chips used in China are from Nvidia, but this may decrease to 50-60% over the next 5 years if restrictions continue.

🫧 Are we in an Nvidia Tech Bubble?

Despite Nvidia’s soaring revenue, many are questioning if Nvidia’s wild rise (up 235% in the last year and 1915% in the past 5 years) is a bubble.

With Nvidia ranking as the #1 most-watched, visited, and mentioned stock on Blossom this week, let’s take a look at what the community has to say:

It’s safe to say that Nvidia is heavily benefiting from the AI wave and that if demand for AI chips slows, this will have a serious impact on the stock. However, if/when that will happen is very difficult to predict.

💡 Check out more great posts by going to the $NVDA stock page on Blossom!

FROM OUR FRIENDS @ COINSQUARE
🪙 Coinsquare - At the Forefront of Crypto's Exciting New Chapter

With the SEC’s recent approval of Spot Bitcoin ETFs, and Bitcoin up over 100% in the past year, Crypto is back on everyone’s minds. If you’re looking for a platform to get exposure to the crypto markets, take a look a Coinsquare!

As Canada’s first crypto-native CIRO-regulated cryptocurrency marketplace (meaning they are overseen by the same regulatory body that regulates brokerages), Coinsquare has set a high bar for secure and transparent crypto trading.

Coinsquare has grown to become one of Canada’s largest Crypto trading platforms, enabling over half a million Canadians to participate in the crypto market!

With a 4.6 rating on the App Store across over 5,000 reviews, Coinsquare is an awesome choice for secure crypto trading.

SOCIAL MEDIA
🤑 Reddit Files to Go Public with Unusual IPO Plans

Setting the stage for the first major social media IPO in years, Reddit has officially filed for its long-anticipated public offering.

While Reddit did not achieve profitability in 2023, with a net loss of $69M, revenue was up 21% to $804M compared to 2022.

Reddit, which boasts 76 million daily visitors spanning over 100,000 communities, is targeting a $5 billion valuation for its upcoming IPO, a notable decrease from the $10 billion valuation it sought during its initial IPO filing in 2021.

🤔 An Unusual IPO

Emphasizing its commitment to the community, Reddit is extending an offer to its top contributors to purchase shares at its IPO, diverging from the traditional approach of prioritizing institutional investors.

This unique strategy is not without risks, as noted in the IPO filing, noting “Redditors’ participation in this offering could result in increased volatility in the market price of our Class A common stock.”

Unlike typical IPO investors who might be subject to a lock-up period, Reddit users participating in the IPO will not have such restrictions, potentially contributing to stock price fluctuations.

🙋‍♀️ Who are the Selected Users?

Reddit’s filing said they will be inviting 75,000 eligible power-users and allocating shares based on a tiered system determined by their "karma" score, which reflects their reputation and contributions to the community.

What’s Known:

• 📊 Stock Structure: Reddit will introduce 3 classes of common stock. Class A shares grant one vote per share, Class B shares offer ten votes per share, and Class C shares provide no voting rights.

• 💸 Trading Info: The Class A stock of Reddit will be listed under the ticker symbol $RDDT and is set to be traded on the New York Stock Exchange (NYSE).

• 🏦 Leading Underwriters: The IPO process for Reddit is being spearheaded by Morgan Stanley and Goldman Sachs as the lead underwriters.

• 🛑 Potential Risks: Reddit has outlined a comprehensive list of risk factors that could impact its business, including challenges in innovation, user growth, competition, and unforeseen external factors.

• 👀 User and Revenue Insights: Further details on Reddit's user engagement and financial performance are forthcoming.

What’s Still Uncertain:

• ⏳️ IPO Timing: The precise date for Reddit's IPO has not been disclosed in the prospectus, though speculation points towards a launch in March 2024.

• #️⃣ Share Quantity: The exact number of shares to be offered during Reddit's IPO remains undisclosed.

• 💰️ IPO Pricing: The initial pricing for Reddit's shares has yet to be announced, with such information typically becoming available just before the shares start trading.

👎 Reddit Approval Rating in the Dumps?

With Reddit’s recent decisions to charge for API access and sell data to train AI models (the former leading to a mass protest that shut down thousands of Reddit forums last year), Reddit approval rating certainly is not at an all-time high.

With Reddit relying more on its users to prop up the IPO, user sentiment will be more important than ever and it will be interesting to watch and see how its controversial decision affects the IPO.

For a full break-down of Reddit’s $60M Deal to Train AI Models, check out the feature article in last week’s Weekly Buzz 🐝

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ELECTRIC VEHICLES
🚘️ EV Sector Faces Reality Check, Rivian and Lucid's Troubled Outlook

Rivian and Lucid who were once promised to become the 'next Tesla,' are facing stark reality checks.

Despite significant backing from Amazon and Saudi Arabia's sovereign wealth fund, Rivian and Lucid's shares have plummeted following their less-than-optimistic forecasts for 2024.

• 📉 Rivian ($RIVN) fell ~38% last week and ~52% YTD

• 📉 Lucid ($LCID) fell ~16% last week and ~27% YTD

🛠️ This comes after Rivian announced that production would stay at last year's levels, while Lucid predicted only a slight increase in output.

🔋 EV Industry Trends

The EV industry's broader trend shows a significant slowdown, with global sales expected to grow by 20% this year, in contrast to the 33% increase in 2023.

This cooling growth, coupled with Rivian and Lucid's struggles, raises concerns about the sustainability and profitability of upstart EV companies, especially when compared to Tesla's (and BYD’s) established dominance.

Despite the grim outlook, the substantial investment and support from Amazon and Saudi Arabia's sovereign wealth fund has provided a safety net for Rivian and Lucid until now; however, as this cash runs out these companies will be pressed to generate demand and achieve profitability in an increasingly competitive and price-sensitive market.

For an awesome breakdown of Rivian’s struggles, check out this video by Wall Street Millenial and join the discussion about Rivian and EVs on Blossom!

FROM THE BLOSSOM COMMUNITY
🎙️ Top Discussions this Week

🗞️ What else you might’ve missed:

• 🚗 Carvana ($CVNA) surges 40% after first annual profit

• 🛒 Walmart ($WMT) gearing up for 3-for-1 stock split

• 🤖 Google ($GOOGL) debuts Gemini for Business as tech firms seek to monetize AI investments

• 🍎 Apple ($AAPL) boosting iMessage security to protect against future quantum computing attacks

• 🛻 Ford ($F) Stops Shipping Electric F-150 Pickup Due to Quality Issue