On Thursday, Jim Cramer discussed how robust quarterly earnings from Nvidia and Salesforce have dispelled major bearish narratives that had been affecting their stock prices. Following the earnings reports, Salesforce shares surged 22%, while Nvidia's rose by 8%.
Cramer emphasized that these results prompted investors to reassess their concerns, particularly regarding Salesforce's vulnerability to AI advancements that could reduce software subscription needs. However, Salesforce reported its strongest sales growth in four years, with significant increases in customer engagement and a doubling of bookings for AI-focused products.
Additionally, its partnership with Anthropic on Claudeforce further mitigated fears about competition. For Nvidia, the earnings results countered worries about declining demand from hyperscalers and competition from custom chips. Cramer noted that Nvidia's customer base is diversifying, with hyperscalers now making up about half of its business.
The company also confirmed that its next-generation AI chip, Vera Rubin, is on track, and its older infrastructure remains effective due to software enhancements. Furthermore, Amazon's commitment to purchasing Nvidia GPUs underscores the ongoing demand for its technology.
Cramer highlighted Nvidia's optimistic revenue outlook, projecting a 70% growth in fiscal 2028, significantly exceeding Wall Street's expectations. He concluded that the market's previous narratives had overshadowed the actual performance of these companies, resulting in substantial losses for short-sellers