Nvidia’s third-quarter results exceeded Wall Street estimates, showing a robust demand for artificial intelligence chips (AI) and related technologies.
According to LSEG, Nvidia’s revenue for the third quarter ended October 27 was $35.08 Billion, exceeding analysts’ expectations of $33.16 Billion.
The adjusted earnings per share were 81 cents compared to the 75 cents expected.
Tech giant has also given a positive outlook for the fourth-quarter, predicting sales of $37.5 billion, exceeding analyst expectations, which were $37.08 billion.
The revenue for the quarter has increased by 70% compared to last year.
Nvidia’s shares fell by 2% after hours despite these outstanding results.
Record-breaking growth in data center revenue
Nvidia’s AI chip division continues to be the main revenue stream.
Analysts’ expectations of $28.82 Billion were surpassed by $30.8 billion.
The popularity of Nvidia AI processors such as its Blackwell next-generation chips has driven this growth.
Nvidia has a comprehensive AI infrastructure. This is evident in the $3.1 billion revenue generated by networking equipment.
The net income of the third quarter soared to $19.3 Billion, which is 78 cents a share. This compares to the $9.24 Billion, or just 67 cents a share in the previous year’s same time period.
The increase in gross margins to 73.5% was attributed to the increased sales of data centers with high profit margins.
Growth is driven by gaming and other sectors
Nvidia’s gaming division posted revenues of $3.28 Billion, which exceeded StreetAccount’s estimated $3.03 Billion.
The growth in GPUs was driven primarily by the increased use of gaming consoles and PCs. This includes chips in Nintendo Switch.
Smaller divisions of the company also performed well.
The automotive sales increased by 72% over the past year, to $449 millions, and professional visualization saw an increase of 17%, reaching $486,000,000 in revenue.
Blackwell chips to dominate AI future
Nvidia has begun shipping its Blackwell AI chip, which is expected to boost its position on the market by 2024.
The CFO Colette Krass admitted that there were supply issues for Blackwell as well as the H200 chip generation. She also said that in 2026, demand will exceed supply during several quarters.
Nvidia is focusing on meeting the growing demand for its products as AI adoption increases across all industries.
Microsoft, Oracle and OpenAI are among the customers who have begun to integrate Nvidia’s leading-edge hardware in their business operations.
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