Nvidia’s latest financial results indicate that the next industrial revolution is well underway, driven by the strong demand for AI chips. The company exceeded both revenue and profit expectations in its fiscal first quarter, with sales booming as leading tech companies like Google, Microsoft, Meta Platforms, Amazon, and OpenAI invest billions in Nvidia’s graphics processing units for generative AI applications. Nvidia’s stock surged by 7% in after-hours trading, surpassing $1,000 for the first time.
In the first quarter, Nvidia reported a 262% year-on-year increase in revenue, totaling $26.04 billion, beating LSEG’s estimate of $24.65 billion. Revenue from data centers surged by 427% to $22.6 billion, with major cloud providers contributing around 40%. Notably, Meta Platforms introduced its latest large language model, Lama 3, powered by 24,000 H100 GPUs, a highlight of Nvidia’s quarter.
Other key highlights include network revenue growth of over three times compared to the previous year, reaching $3.2 billion, primarily due to InfiniBand products. Gaming revenue grew by 18% to $2.65 billion, while revenue from chips for cars and workstations also saw growth. In terms of net income, Nvidia recorded $14.88 billion, or $5.98 per share, a significant increase from the previous year.
Looking ahead, Nvidia forecasts sales of $28 billion for the current quarter, with expectations of even greater revenue growth from its next-generation AI chip, Blackwell. Despite some tech giants expressing intentions to reduce reliance on Nvidia chips, they are still projected to spend $200 billion this year on chips and data centers for AI systems. Nvidia’s results serve as a barometer for the strength of the AI boom, indicating that AI is becoming a crucial commodity in the new industrial era.
CEO Jensen Huang mentioned that demand for Nvidia’s Hopper and Blackwell chips is outpacing supply, signaling a promising future for the company in the AI market. Although Amazon, Google, Meta, and Microsoft have not yet transitioned away from Nvidia chips as planned, the ongoing AI boom underscores Nvidia’s pivotal role in driving technological advancements.
Overall, Nvidia’s latest financial results reaffirm its position as a key player in the AI industry and a driver of the ongoing technological revolution. The company’s innovative products and strong financial performance underscore its potential for further growth in the evolving AI landscape.
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https://finance.yahoo.com/news/nvidias-first-quarter-results-confirm-201309754.html