Palantir (NYSE:PLTR) stock is trending on social media, and PLTR stock is down 4%. Palantir, which unveiled an artificial intelligence (AI) platform earlier this year, climbed in sympathy with Nvidia (NASDAQ:NVDA) in pre-market trading. However, after the market opened, PLTR proceeded to drop into the red.
Yesterday after the market closed, Nvidia, for the second straight quarter, delivered stronger-than-expected quarterly results and provided guidance that came in well above analysts’ average outlooks. Once again, AI was the positive catalyst that enabled NVDA to surpass the mean estimates by large amounts.
Nvidia’s Q2 Results and Palantir
Last quarter, Nvidia’s top line soared 88% versus Q1 and 101% compared with the same period a year earlier to $13.51 billion. Analysts’ average estimate was only $11.09 billion. The company’s sales from data centers, whose workloads are greatly increasing as a result of the AI revolution, soared an incredible 141% versus Q1 and 171% year-over-year.
On the bottom line, the chipmaker’s earnings per share, excluding certain items, came in at $2.70, versus the mean estimate of $2.09. As far as Q3 guidance is concerned, NVDA expects sales of $16 billion, plus or minus 2%, very far above the mean estimate of $12.4 billion.
Nvidia is providing “the computing infrastructure” of AI, with cloud infrastructure companies and “[l]eading enterprise IT system and software providers” all using the firm’s chips to enable the technology, CEO Jensen Huang reported.
The company’s chips power the calculations that enable generative AI, and Nvidia’s results show that the use of AI is accelerating tremendously, boding very well for many AI stocks, such as PLTR.
PLTR Stock: Palantir’s AI Connection
In June, PLTR launched an AI platform that can, like ChatGPT, generate “conversational” answers to users’ questions. Palantir believes that its new platform can avoid the “hallucinations” that other chatbots have been notorious for.
Earlier this month, PLTR CEO Alex Karp said the company “will figure out how to monetize” AI. The firm has contended that its platform will enable organizations to make better decisions.
In 20 years, Palantir has never turned an annual profit. However, with Nvidia’s chips powering a new wave of AI tools, PLTR might finally manage to do it.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
