Ondo (ondo) 
Nvidia has announced a quarterly revenue forecast that surpasses estimates and revealed a stock split, driving its shares to record highs. This development has also had an impact on AI-focused cryptocurrencies.
According to a report from May 25, the Santa Clara, California-based company, known for its advancements in GPU accelerated computing, will implement a ten-for-one stock split effective June 7. Additionally, it will increase its quarterly dividend by 150% to 1 cent per share on a post-split basis.
A stock split divides existing shares into multiple shares to increase liquidity. Companies usually opt for stock splits when their share price becomes too high, which can deter small investors.
Nvidia shares soared 5.9% to $1,005 in extended trade, surpassing the $1,000 mark and adding approximately $140 billion in stock market value.
Nvidia stock, $NVDA, surges toward $1,000/share after reporting earnings and a 10:1 stock split.
The company reported record quarterly revenue of $26 billion with an EPS of $6.12, both exceeding expectations. This represents a 260% year-over-year revenue increase for the world’s third-largest chipmaker.
The leading chipmaker forecasts fiscal second-quarter revenue to be $28 billion, plus or minus 2%. Analysts had expected revenue of $26.66 billion, according to LSEG data.
First-quarter revenue surged 262% year-over-year to $26.04 billion, beating estimates of $24.65 billion. Net income soared 628% to $14.88 billion.
Contrary to crypto traders’ expectations, Nvidia’s strong earnings did not immediately boost AI-related cryptocurrency tokens.
Render (RNDR), a decentralized graphics processing unit rendering platform on Ethereum, saw a 12% decline within five hours of the earnings report, dropping to $10.48. At the time of writing, the token was down 6.6% with a 24-hour trading volume of $827 million.
Despite this initial drop, historical data suggests potential for a rebound. During Nvidia’s Q4 earnings event in February, RNDR rose 38% within 48 hours.
Crypto trader D0C Crypto speculated that RNDR could surge above $15 from its current price if historical trends repeat.
Adding to the speculation, a known whale wallet transferred approximately $52.1 million worth of RNDR tokens to an unknown wallet. According to market data, this move suggests that major players are positioning themselves based on Nvidia’s results and potential market reactions.
Fetch.ai’s token FET was trading around $2.65 at the time of Nvidia’s earnings announcement and has since dropped 2.8% to $2.45.
Other popular AI tokens, such as The Graph (GRT) and SingularityNet (AGIX), also recorded drops ranging from 4% to 6%.
Even though AI crypto tokens have faced price drops, market watchers are hopeful that Nvidia’s strong performance will positively affect the sector, as seen in previous market cycles.
“The Nvidia stock split announcement could significantly impact the AI crypto token market. Nvidia’s earnings often make these tokens surge,” said Tim Zinin, founder of Botanica School. “With the stock split, more people might invest as the shares become more affordable. This could boost confidence in tech and AI tokens even more. Investors are now fully convinced that artificial intelligence is here to stay,” he added.
Marco Pagnini, fund manager at Moonwalk Systems, noted the high correlation between Nvidia stocks and AI tokens, stating, “Traditional finance has started to use crypto tokens with high correlation to the traditional market to front-run stock traders: easy trading access, less competition.” He also mentioned that the stock split reduces entry barriers for retail investors, which is beneficial for stock owners but not necessarily for token owners.
Ignacio Palomera, CEO of Bondex, agreed, adding that Nvidia’s earnings reports tend to benefit the broader market. He mentioned that the AI narrative is starting to take off on decentralized networks, merging the interests of miners and the ML community.
Zac Shander-Kelsey, CEO of Nodabank, added, “We have seen how the traditional sector influences cryptocurrency, and this is no different. Just like with crypto in 2017-18, the market is still figuring out how crypto and AI interact. Once retail investors get more involved, we will see stronger correlations.”
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