Nvidia outperforms analyst predictions with US$22.1b fourth quarter revenue
American artificial intelligence (AI) company Nvidia has defied analyst predictions to post revenue of a whopping US$22.1 billion in its fourth quarter earnings report.
Revenue for the three months to end January was 22% higher than the previous quarter and 265% higher than the same time last year.
Analysts had expected the figure to be around US$20.5b, underpinned by a boom in accelerated computing and generative AI.
The growth was propelled by record quarterly revenue from its data centres of US$18.4b, marking a 27% rise on the previous quarter and 409% year-on-year growth.
The company’s full-year revenue soared by 126% to US$60.9b, with GAAP (generally accepted accounting principles) earnings per share (EPS) up 586% and non-GAAP EPS up 288% from the previous year.
Nvidia’s revenue has tripled in the last quarter and its earnings have now beaten analyst expectations for the past four periods.
Operating income
As a leading developer of graphics processing units (GPUs) and AI platforms, Nvidia has seen its products and services become increasingly critical to sectors including gaming, professional visualisation and automotive.
The company’s operating income for the quarter hit US$13.6b, representing a 31% increase on the previous quarter and a 983% increase year-on-year.
Net income reached US$12.3b, up 33% on the previous quarter and 769% on the same time last year.
GAAP-diluted EPS was US$4.93, which is a 33% increase on the previous quarter and a 765% increase on the previous year.
Non-GAAP-diluted EPS was even higher at US$5.16, marking increases of 28% and 486% respectively.
The substantial increase in EPS is believed to indicate robust profitability and may signal strong future potential for the company.
Nvidia’s gross margin during the year followed a similar trend to reach 76% in the fourth quarter — up from 74% in the third quarter and 63.3% from the previous year.
The expansion is believed to underscore the company’s ability to increase sales profitably, which is considered to be a key indicator of financial health for value investors.
Global AI boom
Nvidia founder and chief executive officer Jensen Huang said the record financial performance had been driven by the global AI boom.
“Accelerated computing and generative AI have hit the tipping point,” he said. “Demand is surging worldwide across companies, industries and nations.”
“Our Data Centre platform is powered by increasingly-diverse drivers such as demand for data processing, training and inference from large cloud-service providers and GPU-specialised ones — and vertical industries led by auto, financial services and healthcare are now at a multibillion-dollar level.”
Computing pioneer
Founded in 1993, Nvidia has become a pioneer in accelerated computing.
The company’s invention of the GPU in 1999 sparked the growth of the personal computer gaming market, redefined computer graphics and is now fuelling industrial digitalisation across markets.
Mr Huang said Nvidia had become a “full-stack computing infrastructure company” with data-centre-scale offerings which are “reshaping industry”.
Google collaboration
Nvidia announced a collaboration with Google this week that will see its AI platforms optimised to accommodate Google’s set of new language models known as “Gemma”.
The models come in two sizes — one is comprised of a neural network with 2 billion adjustable variables (or parameters), while the other has 7 billion parameters.
Nvidia said the open-source Gemma models have been optimised for an installed base of over 100 million Nvidia RTX GPUs worldwide in addition to its AI chips such as the H100.
Gemma will also be integrated into Nvidia’s “Chat with RTX” technology, which lets AI models run locally and can access user files to generate answers to simple prompts.