NVDIA and CAT Hammered on Warnings, Soft Demand in China

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NVDIA fell 12.82% and CAT fell 9.13% on revenue warnings and a slowdown in China.

Apple led the way on January 2 blaming slowing sales of smartphones and other devices in China. Apple Lost a Record $463 Billion in Market Cap in Three Months.

Today, Caterpillar and Nvidia Warnings Send Wall Street Tumbling.

Shares of Caterpillar, the world's largest heavy equipment maker, fell 9.13 percent and had their worst day since 2011 after the company's quarterly profit widely missed Wall Street estimates, hit by softening demand in China and higher manufacturing and freight costs.

Nvidia tumbled 13.82 percent after the chipmaker cut its fourth-quarter revenue estimate by half a billion dollars on weak demand for its gaming chips in China and lower-than-expected data center sales.

Whirlpool

Whilrpool is down 6% after hours after missing forecasts.

Zerohedge comments Whirlpool Tumbles After Missing Revenue, Slashing Guidance.

As for the key reason why the stock is getting hit after hours, the company now forecasts non-GAAP EPS of $14.00 to $15.00, far below the $15.98 consensus estimate, as "favorable product price/mix, restructuring benefits and reduced share count are offset by a higher tax rate and cost and currency increases."

In other words, not even the company's buybacks, and Whirlpool announced it repurchased $1.2 billion in stock in 2018, up from $750MM in 2017, will be enough to offset rising input costs, the stronger dollar, and the company's higher (?) tax rate.

Who's Next?

Broadcom (AVGO), Micron Technology (MU), Qualcomm (QCOM), Qorvo (QRVO), Skyworks Solutions (SWKS) and Wynn Resorts (WYNN) get more than half their sales from Greater China, according to Goldman Sachs.

Mike "Mish" Shedlock

Comments (8)
No. 1-5
Carl_R
Carl_R

Isn't the leading market for Nvidia chips their use in Bitcoin mining? I'm guessing that is what they are calling "Data center sales"? If crypto mining is a significant part of their revenue, it's not surprising they might have a sales drop.

2banana
2banana

Trump tariffs kicked in January 1st to a Chinese economy that was already teetering.

China is going to get crushed unless they liberalize their markets are greatly reduce their trade imbalances.

Hey, did you hear? After some tough talk - NATO is actually going to pay for their defense...

Mish
Mish

Editor

bitcoin is indeed one of their markets

gregggg
gregggg

BDI Baltic Exchange Dry Index 852.00USD

everything
everything

Yes, rumor is crypto pushed Nvidia now you can find the mining products for sale as they give up on it, something about the energy required to run the equipment is more than the mining profits, this is typical for how people or groups run in tandem with technology, as in investment money. Cat has had drops in the past, look at copper prices the last year, down, not that dr. copper means anything, but we do have a slow fall in price, as well as falling warehouse stocks to boot. Whirlpool who knows, Real Estate really slows down this time of year. When L.A. is starting to put away a rainy day fund for the next recession we know something is coming, are folks starting to tighten the belt? So far it's starting to look allot like 2016.