Nvidia reported impressive fiscal third-quarter results, surpassing Wall Street’s predictions with $18.12 billion in revenue, marking a remarkable 206% year-over-year growth. The demand for Nvidia’s GPUs has surged due to generative AI. The company’s net income reached $9.24 billion, $3.71 per share, up from last year.
Despite this success, Nvidia anticipates a negative impact in the next quarter due to export restrictions affecting sales to organizations in China and other countries. Nvidia’s CFO, Colette Kress, expects a significant sales drop to certain destinations. However, she’s optimistic, anticipating growth in other regions.
Nvidia’s data center revenue stood out, totaling $14.51 billion, a remarkable 279% increase, with half coming from cloud infrastructure providers like Amazon. The gaming segment contributed $2.86 billion, an 81% increase. Looking ahead, Nvidia has set ambitious guidance, aiming for $20 billion in revenue for the fiscal fourth quarter, implying nearly 231% revenue growth.
During the quarter, Nvidia unveiled the GH200 GPU, featuring more memory than the current H100 and an additional Arm processor onboard. This move aligns with the company’s efforts to cater to the growing demand for high-performance products. Iris Energy, an Australia-based bitcoin mining data center owner, purchased 248 H100s for $10 million.
The landscape has shifted for Nvidia, with server farms now driving most of its revenue, surpassing sales from GPUs for PC gaming. The introduction of the ChatGPT chatbot in 2022 fueled the demand for Nvidia’s GPUs as companies sought to integrate similar generative artificial intelligence capabilities into their software.
Despite facing obstacles, including competition from AMD and export restrictions in China, analysts remain optimistic about Nvidia’s future. Raymond James’ Srini Pajjuri and Jacob Silverman noted that GPU demand continues to outpace supply, expecting Nvidia to maintain over 85% share in Gen AI accelerators even in 2024.
Nvidia’s stock has experienced a remarkable 241% increase this year, outperforming the S&P 500 index by a significant margin. The company is actively working on plans to expand its supply throughout the next year, indicating a commitment to sustaining its growth trajectory.
Summary:
Nvidia achieved remarkable Q3 results, boasting $18.12 billion in revenue driven by high GPU demand and AI adoption. Despite export challenges, the company maintains an optimistic outlook for sustained growth.
