Jensen Huang, co-founder and chief executive officer of Nvidia Corp., during the Nvidia GPU Technology Conference (GTC) in San Jose, California, US, on Tuesday, March 19, 2024.
David Paul Morris | Bloomberg | Getty Images
Nvidia reported fiscal first-quarter earnings on Wednesday that beat expectations for sales and earnings, and provided a strong forecast for the current quarter.
Nvidia’s results have become a way for investors to gauge the strength of the AI boom that has transfixed markets in recent months. Its strong results on Wednesday suggest that demand for the AI chips Nvidia makes remains strong, and CEO Jensen Huang said the company would see revenue from its next-generation AI chip, called Blackwell, later this year.
The stock rose 7% in extended trading, passing $1000 per share for the first time. Nvidia also said it was splitting its stock 10 to 1.
Nvidia shares hit a record on Tuesday, closing at $953.86, before slipping Wednesday. Based on the after-market move, the shares are poised to reach a fresh high on Thursday.
- Earnings Per Share: $6.12 adjusted vs. $5.59 adjusted, per LSEG consensus estimates.
- Revenue: $26.04 billion vs. $24.65 billion expected by LSEG
Nvidia said it expected sales of $28 billion in the current quarter. Wall Street was expecting earnings per share of $5.95 on sales of $26.61 billion, according to LSEG.
Nvidia reported net income for the quarter of $14.88 billion, or $5.98 per share, compared with $2.04 billion, or 82 cents, in the year-ago period.
In the past year, Nvidia sales have skyrocketed as companies such as Google, Microsoft, Meta, Amazon and OpenAI buy billions of dollars of Nvidia’s GPUs, which are advanced and pricey chips required for developing and deploying artificial intelligence applications.
The company’s largest and most important business is its data center sales, which includes its AI chips as well as many of the additional parts needed to run big AI servers.
Nvidia said its data center category rose 427% from the year-ago quarter to $22.6 billion in revenue. Nvidia CFO Colette Kress said in a statement that it was due to shipments of the company’s “Hopper” graphics processors, which include the company’s H100 GPU.
“A big highlight this quarter was Meta’s announcement of Lama 3, their latest large language model which used 24,000 H100 GPUs,” Kress said on a call with analysts. She added that large cloud providers comprised about “mid-40%” of Nvidia’s data center revenue.
Even as the company reports a tripling or more of its business, CEO Huang said that the company’s next-generation AI GPU, called Blackwell, would lead to more growth.
“We will see a lot of Blackwell revenue this year,” Huang said on a call with analysts, saying that the new chip would be in data centers by the fourth quarter.
Nvidia also highlighted strong sales of its networking parts, which are increasingly important as companies build clusters of tens of thousands of chips that need to be connected. Nvidia said that it had $3.2 billion in networking revenue, primarily its Infiniband products, which was over three times higher than last year’s sales.
Nvidia, before it became the top supplier to big companies building AI, was known primarily as a company making hardware for 3D gaming. The company’s gaming revenue was up 18% during the quarter to $2.65 billion, which Nvidia attributed to strong demand.
The company also sells chips for cars and chips for advanced graphics workstations, which remain much smaller than its data center business. The company reported $427 million in professional visualization sales, and $329 million in automotive sales.
Nvidia said it bought back $7.7 billion worth of its shares and paid $98 million in dividends during the quarter. Nvidia also said that it’s increasing its quarterly cash dividend from 4 cents per share to 10 cents on a pre-split basis. After the split, the dividend will be a penny a share.
