Nvidia NVDA Q3 2023 Earnings Call Transcript The Motley Fool

nvidia q3 earnings 2022

Actually, it’s head start is even longer, with 2006 probably being a better marker. That’s the year Nvidia developed CUDA and without CUDA, Nvidia’s GPUs would not possess the parallel processing capabilities needed to accelerate general computing or AI training https://bigbostrade.com/ and inferencing. Nvidia’s annual report mentions “AI” or “artificial intelligence” 1,187 times! Moreover, the report uses the term “generative AI” 35 times. Generative AI is the technology behind ChatGPT, the hugely popular chatbot that launched late last year.

So the small incremental investment they make in high-performance networking translates to billions of dollars of savings slightly in provisioning the service or billions of dollars more throughput, which increases their economics. And so, these days, with disaggregated and I application, AI provisioning and data centers, high-performance networking is really quite fantastic and it pays for itself right away. But that’s where we are focused in high-performance networking and provisioning AI services in — well, the AI applications that we focus on. You might have noticed that NVIDIA and Microsoft are building one of the largest AI infrastructures in the world.

The funny thing is that we’re already seeing a diverse performance experience across the space. Second quarter results are expected to include approximately $1.32 billion of charges, primarily for inventory and related reserves, based on revised expectations of future demand. Data Center revenue, though a record, was somewhat short of the company’s expectations, as it was impacted by supply chain disruptions. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation.

Oracle and NVIDIA are also working together to offer AI training and inference at scale to thousands of enterprises. This includes bringing to Oracle cloud infrastructure the full NVIDIA accelerated computing stack and adding tens of thousands of NVIDIA GPUs, including the A100 and H100. Cloud-based high-performance is adopting NVIDIA AI enterprise and other software to address the industrial scientific communities’ rising demand for AI in the cloud.

nvidia q3 earnings 2022

And whose leading server virtualization platform, vSphere, has been rearchitected over the last two years to run on DPUs and now supports our BlueField DPUs. During the second quarter of fiscal 2023, NVIDIA returned to shareholders $3.44 billion in share repurchases and cash dividends, following a return of $2.10 billion in the first quarter. The company has $11.93 billion remaining under its share repurchase authorization through December 2023.

Adjusted EPS increased 103.1% compared to the year-ago quarter, its fastest pace since the first quarter of FY 2021. Revenue expanded 83.8% YOY, marking its fastest pace in at least 19 quarters. Nvidia noted that its data center business continued to expand as companies around the world increase their adoption of artificial intelligence (AI) for various applications. Nvidia Corp. (NVDA) last year posted its fastest earnings and revenue growth in recent years, driven by strong demand for semiconductor chips.

NVDA earnings call for the period ending September 30, 2022.

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Gamers waited in long lines around the world, 4090 stocks sold out quickly. Hopper, with its revolutionary transformer engine is just in time to meet the surging demand for recommender systems, large language models and generative AI. I think you genomics stocks talked about supply being a headwind at one point. And then, when you were speaking to the networking business, I think you talked about supply easing. So I was hoping you can kind of speak to supply if you’re caught up to demand at this point.

First, is there any effect of stockpiling in the data center guidance? I ask because you now have the A800 that is sort of a modified version of the A100 with the lower data transfer rate. So one could imagine that customers might be stocking that while they can still get it. In the documentation, you talked about that being a portion of inventory on hand plus some purchase obligations. And you also spoke in your prepared remarks that some of this was due to China data centers. And we announced recently Nemo, large language model and bionemo large language model to put NVIDIA software in the cloud.

Cloud providers and a broadening set of consumer Internet companies for workloads such as large language models, recommendation systems and generative AI. As the number and scale of public cloud computing and Internet service companies deploying NVIDIA AI grows our traditional hyperscale definition will need to be expanded to convey the different end market use cases. We also launched GeForce now on the new gaming devices, including Logitech, Cloud handheld, cloud gaming Chromebooks and Razor 5G Edge.

Nvidia has traditionally specialized in making chips for the gaming and graphics industry, being a pioneer in the development of graphics processing units (GPUs). It turns out that the robust computational capabilities employed by GPUs to power video games and graphics software are also well-suited for technologies like artificial intelligence (AI) and machine-learning. Both of those technologies are increasingly important for the rapidly growing data center market. Demand for remote computing power increased substantially during the pandemic as more and more people began working from home and businesses were forced to shift certain operations online. That development has helped to boost demand for Nvidia’s chips used by data centers. DRIVE Thor delivers up to 2,000 teraFLOPS of performance and leverages technologies introduced in our Grace Hopper and Ada architectures.

Transcript : Optical Cable Corporation, Q3 2023 Earnings Call, Sep 12, 2023

If you’re going to spend $20 billion on an infrastructure and the efficiency of that overall data center is improved by 10%. It is an indexed to overall enterprise and data center spend but it is highly indexed to AI adoption. So your question is regarding the sequentials from Q3 to our guidance that we provided for Q4.

nvidia q3 earnings 2022

Revenue of $1.57 billion was down 23% sequentially and down 51% from a year ago, reflecting lower sell-in to partners to help align channel inventory levels with current demand expectations. We believe Channel inventories are on track to approach normal levels as we exit Q4. Nvidia reported Q2 FY 2022 earnings and revenue that beat analysts’ expectations. Adjusted EPS rose 89.9% compared to the year-ago quarter, slowing from the previous quarter’s rapid pace. Revenue grew 68.3% year over year (YOY), also slowing from the pace set in Q1. Nvidia said it achieved record companywide revenue during the quarter as well as record revenue in its gaming, data center, and professional visualization businesses.

NVIDIA Announces Financial Results for Third Quarter Fiscal 2023

We have been building for those architectures to come to market and as such to say. We are always looking at our inventory levels at the end of each quarter for our expected demand going forward. Revenue of $251 million, increased 14% sequentially and 86% from a year ago. Growth was driven by an increase in AI automotive solutions as our customers drive or on-based production ramp, continue to scale. Global cars unveiled the all-new flagship Volvo EX90 SUV powered by the NVIDIA Drive platform. Nvidia reported fiscal third-quarter results on Wednesday for the period ending in October with sales beating analyst expectations but earnings per share coming in light.

  • This material should not be relied upon as research or investment advice regarding any security in particular.
  • AMD and Intel have chips used for AI processing — with AMD planning to ramp production of its new powerful MI300 AI chip in the fourth quarter — but neither is as big a player in this market as Nvidia.
  • In February when Nvidia released in fiscal 2023 report, many investors likely already knew the company was a dominant force in the AI tech realm.
  • At the end of Q3, we had approximately $8.3 billion remaining under our share repurchase authorization through December €˜23.
  • Revenue of $251 million increased 14% sequentially and 86% from a year ago.

And desktop, a bit softer, particularly in that China and Asia areas. We expect though stronger end demand, though, as we enter into Q4, driven by the upcoming holidays, as well as the continuation of the ADA adoption. They just revealed what they believe are the ten best stocks for investors to buy right now… That’s right — they think these 10 stocks are even better buys. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. “We are navigating our supply chain transitions in a challenging macro environment and we will get through this,” said Jensen Huang, founder and CEO of NVIDIA.

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It was the fastest pace of revenue growth since Q1 FY 2019. Nvidia has posted strong financial results in recent quarters after four consecutive quarters of declining earnings and revenue between Q4 FY 2019 and Q3 FY 2020. In the final quarter of FY 2020, adjusted EPS soared 135.5% YOY, marking the fastest growth since Q1 FY 2019. Growth has since decelerated to 104.5% in Q1 FY 2021 and 76.4% in Q2 FY 2021, but those are still envious growth rates, especially during a pandemic.

Nvidia also introduced new software products called “Omniverse Enterprise” that can be used to create virtual characters, interpret speech and create new 3D worlds. Nvidia’s professional visualization product line grew 144% annually to $577 million. That business is primarily high-end graphics processors for professionals. The segment continues to grow as firms buy powerful laptop workstations for their staff to use at home.

First, the adoption of NVIDIA in Internet service companies around the world, the number and the scale by which they’re doing it has grown a lot. Customers are clamoring to ramp hopper as quickly as possible, and we are trying to do the same. We are all hands on deck to help the cloud service providers stand up the supercomputers. Remember, I is the only company in the world that produces and ships semi-custom supercomputers in high volume.

So as we highlighted in our prepared remarks, we booked an entry of $702 million for inventory reserves within the quarter. Most of that, primarily, all of it is related to our data center business, just due to the change in expected demand looking forward for China. So when we look at the data center products, a good portion of this was also the A100, which we wrote down. Sell-through for our gaming products was relatively solid in the Americas and EMEA and but softer in Asia Pac as macroeconomic conditions and covered lockdowns in China continued to weigh on consumer demand. All our statements are made as of today, November 16, 2022, and based on information currently available to us. The webcast will be available for replay until the conference call to discuss our financial results for the fourth quarter and fiscal 2023.

Investors will also be focusing on Nvidia’s data center revenue, a key metric of sales generated by a rapidly-growing segment of the company’s business. Demand for data center services has increased amid the pandemic, sparking a rise in demand for Nvidia’s chips. Analysts expect the company’s data center revenue to accelerate from the previous quarter’s rapid growth.

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Annual revenue is forecast to expand 54.4%, which would be the fastest pace of growth in at least the past seven years. Gaming, Nvidia’s biggest market, reported $3.2 billion in sales, up 42% from $2.27 billion in the same quarter last year. The company said it was primarily due to increased sales of its GeForce consumer graphics processors, but the company said supply remained limited. “NVIDIA is firing on all cylinders, achieving record revenues in Gaming, Data Center and overall,” said founder and CEO Jensen Huang. The company also indicated that its proposed acquisition of U.K.-based Arm Ltd. is expected to close during the first quarter of calendar year 2022.

Nvidia said it spent $3.75 billion on share repurchases and dividends during the quarter. Nvidia said that the reduced sales from the GPUs barred in China would be largely offset by its alternative products. The company’s $40 billion plan to purchase chip designer ARM has hit a regulatory wall in the U.K.

I mean, what does that mean for the business that is just a reflection of where demand is and you’re going to break things out differently? Or is something changing about the mix of I guess, internal properties versus vertical industry demand within the hyperscale customer base. I guess, Colette, I heard in your script that you had talked about maybe a new way of commenting on or reporting hyperscaler revenue in your data center business.

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