Astera Labs experienced a notable surge in its stock price, climbing 10.8% by 2:45 p.m. ET on Thursday, as reported by S&P Global Market Intelligence. This significant increase comes despite the absence of any specific news related to Astera’s business. Instead, the company’s market valuation is benefiting from Nvidia’s recent quarterly report, which, despite its own stock dipping by 4.5% in daily trading, has buoyed many AI-related shares.
Nvidia’s Q2 financial results reflect a robust demand within the AI sector, particularly evident in its data-center segment, which saw a remarkable 154% year-over-year revenue growth, reaching $26.3 billion for the fiscal quarter ending on July 28. This contributed to an overall revenue of approximately $30 billion, marking a 122% increase from the previous year. With sturdy profit margins, Nvidia’s non-GAAP adjusted earnings per share soared by 152% compared to the same period last year. For the upcoming quarter, Nvidia has projected revenues of around $32.5 billion, surpassing the pre-report average analyst forecast of $31.7 billion.
The impressive Q2 outcomes and optimistic future projections have sparked investor interest in AI-related stocks, including Astera Labs. Additionally, Nvidia’s comments regarding its forthcoming Blackwell chips have likely contributed to Astera’s share price momentum.
In a recent investor conference call, Nvidia announced its anticipation of starting production for its next-generation Blackwell processors in the fourth quarter of this year. Although the market expressed some disappointment over the delayed release of this new chip platform, there remains a positive outlook on its implications for Astera Labs.
There is speculation among analysts and investors that Astera’s technology may be integrated into Nvidia’s forthcoming GB200 processors. Astera Labs’ CEO, Jitendra Mohan, highlighted in the company’s last quarterly call that the growing average dollar content in next-gen GPU-based AI platforms boosts their confidence in surpassing industry growth rates. Should Astera secure contracts to support the upcoming Blackwell processors at higher sales prices, the company could be poised for a significant performance boost in the near future.
