Nvidia Shares hit the $1,000 mark for the first time in extended trading on Wednesday, after the chipmaker reported fiscal first-quarter results that exceeded analysts' expectations.
Nvidia's quarterly report has become a way for investors to gauge the strength of the AI boom that has transfixed the markets in recent months. Wednesday's strong results suggest demand for the AI chips Nvidia makes remains robust, 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. Nvidia also said it will split its shares 10-for-1. Based on the aftermarket move, shares are poised to hit a new high on Thursday.
- Profit per share: $6.12 adjusted vs. $5.59 adjusted, per LSEG consensus estimates.
- Gain: $26.04 billion versus $24.65 billion expected by LSEG
Nvidia said it expects revenue of $28 billion for the current quarter. According to LSEG, Wall Street expected earnings per share of $5.95 on revenue of $26.61 billion.
The chipmaker reported net income of $14.88 billion, or $5.98 per share, for the quarter ended April 28, compared with $2.04 billion, or 82 cents, in the same period a year earlier.
In the past year, Nvidia's sales have skyrocketed as companies like Googling, Microsoft, Meta, Amazon and OpenAI are buying Nvidia's graphics processing units for billions of dollars, which are advanced and expensive chips needed to develop and deploy artificial intelligence applications.
Nvidia CEO Jensen Huang delivers a keynote speech during the Nvidia GTC Artificial Intelligence Conference at SAP Center on March 18, 2024 in San Jose, California.
Justin Sullivan | Getty Images
The company's largest and most important business is selling data centers, which includes the AI chips and many of the additional components needed to run large AI servers.
Nvidia said the data center category increased 427% from the year-ago quarter to $22.6 billion in revenue. Nvidia Chief Financial Officer Colette Kress said in a statement that this was due to the shipment of the company's Hopper graphics processors, including the company's H100 GPU.
“A big highlight this quarter was Meta's announcement of Lama 3, their latest major language model using 24,000 H100 GPUs,” Kress said on a call with analysts. She added that major cloud providers make up about “mid 40%” of Nvidia's data center revenue.
Even as the company reports a tripling or more in revenue, Huang said the company's next-generation AI GPU, called Blackwell, would lead to more growth.
“We'll see a lot of Blackwell revenue this year,” the CEO said on a call with analysts, adding that the new chip would be in data centers in the fourth quarter.
Nvidia also highlighted strong sales of its networking components, which are becoming increasingly important as companies build clusters of tens of thousands of chips that need to be connected together. Nvidia said it had $3.2 billion in networking revenue, mainly its InfiniBand products, which was more than three times higher than its revenue in the year-ago period.
Before it became the top supplier to major companies building AI, Nvidia was best known as a company that made hardware for 3D gaming. Gaming revenue rose 18% to $2.65 billion during the quarter, which Nvidia attributed to strong demand.
The company also sells automotive chips and chips for advanced graphics workstations, which remain much smaller than its data center business. It reported $427 million in professional visualization sales and $329 million in automotive sales.
Nvidia said it repurchased $7.7 billion in shares and paid out $98 million in dividends during the quarter. Nvidia also said it is 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 one cent per share.
