Nvidia Earnings

The legendary company in the field of artificial intelligence announced its third quarter results last night and… folks, the numbers are unbelievable. We will look at where these profits came from, why the stock skyrocketed immediately after, and of course, what we can expect going forward.

Because as it turns out, Nvidia is not just part of the AI revolution, it is the force pushing it ahead.

RESULTS OF THE QUARTER

Nvidia announced revenue of $57.01 billion for the quarter that ended on October 26.

That’s a 62 percent jump compared to last year. Its net income reached $31.91 billion, or $1.30 per share, far exceeding analysts’ estimates. For comparison, during the same period last year the company had earned 78 cents per share. This is a literal explosion in profits.

The largest portion, as expected, came from the Data Center division. It generated $51.2 billion on its own, up 66 percent year over year. Of that, $43 billion came from GPUs for compute power, while the remaining $8.2 billion came from networking hardware. In other words, components that enable servers to communicate with each other as if they were a single supercomputer. This is the heart of today’s AI infrastructure.

Next comes gaming, with $4.3 billion (+30 percent), slightly below analyst expectations, but still a huge figure. Professional visualization brought in $760 million (+56 percent), thanks to products like DGX Spark, Nvidia’s AI desktop computer. Meanwhile, the automotive and robotics segment reached $592 million (+32 percent), showing that Nvidia ($NVDA) isn’t resting on its laurels but is building future revenue streams.

According to CEO Jensen Huang himself, sales of the new Blackwell chip are “off the charts”, while cloud GPUs are sold out. “We have entered the virtuous cycle of artificial intelligence,” he said. And he’s not wrong. Huang notes that demand is growing exponentially for both training and inference. In other words, companies never stop training and using AI models and they constantly want more power.

Nvidia not only beat expectations, but also issued guidance for the next quarter that left investors stunned. The company expects revenue of $65 billion, while analysts were expecting $61.6 billion. At the same time, it anticipates gross margins of 75 percent. And all this without including the Chinese market, due to export restrictions. Yet Nvidia keeps moving forward without slowing down.

Posted Using INLEO