NVIDIA Corp. has provided a positive sales forecast, indicating the continued strong investment in AI computing. The company predicts a second-quarter revenue of around $28 billion, surpassing analysts’ expectations of $26.8 billion. CEO Jensen Huang expressed optimism about the impact of AI on various industries, highlighting its potential for boosting productivity and revenue.
NVIDIA has emerged as a significant player in the AI market, with its AI accelerators witnessing a surge in sales as data centers adopt advanced AI tools. The company’s market value has exceeded $2.3 trillion, reflecting its leadership in AI technology. Following the announcement, NVIDIA’s stock rose by 4% in extended trading, continuing its upward trajectory this year.
Initially focused on providing graphics cards for gamers, NVIDIA pivoted towards AI development, leveraging its chips for artificial intelligence software. The launch of OpenAI’s ChatGPT in 2022 intensified the demand for NVIDIA’s H100 accelerators, making them essential for tech giants developing AI infrastructure.
Despite the revenue growth, a significant portion of NVIDIA’s sales comes from a few major customers, including Amazon.com Inc., Metaplatforms INC., Microsoft Corp., and Alphabet Inc. These companies account for approximately 40% of NVIDIA’s sales. Huang aims to broaden the company’s reach by offering a comprehensive range of AI solutions to more organizations and government agencies.
In the fiscal first quarter, NVIDIA’s revenue tripled to $26 billion, with the data center division being the largest revenue source. The company emphasized its expansion beyond hyperscalers to consumer internet companies, automakers, and healthcare customers. NVIDIA’s new chip platform, Blackwell, is expected to support generative AI capable of handling trillions of parameters, signaling the company’s readiness for future growth opportunities.
Overall, NVIDIA’s positive sales forecast and strategic initiatives position the company as a key player in the AI market, with a focus on diversifying its customer base and expanding into emerging AI applications. The company’s success in the AI industry reflects its ability to innovate and adapt to the evolving technological landscape.
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https://fortune.com/2024/05/22/nvidia-shares-jump-4-as-the-ai-boom-fuels-a-another-blockbuster-quarter-and-better-than-expected-forecast/
