Nvidia Corp on Wednesday surged in late trading after delivering another eye-popping sales forecast, adding fresh momentum to a stock rally that already made it the world’s most valuable chipmaker.
Revenue in the current period would be about US$24 billion, the company said in a statement. Analysts had predicted US$21.9 billion on average. Results in the fourth quarter also sailed past Wall Street estimates.
The outlook extends a streak of Nvidia shattering expectations, thanks to insatiable demand for its artificial intelligence (AI) accelerators — highly prized chips that crunch data for AI models. The technology has helped power a proliferation of chatbots and other generative AI services, which can create text and graphics based on simple prompts.
Photo: Bloomberg
“Accelerated computing and generative AI have hit the tipping point,” Nvidia chief executive officer Jensen Huang (黃仁勳) said in the statement. “Demand is surging worldwide across companies, industries and nations.”
The shares jumped as much as 11 percent in extended trading following the announcement. They earlier closed at US$674.72 in New York, leaving them up 36 percent for the year.
Nvidia’s market capitalization has increased by more than US$400 billion this year — bringing its valuation to US$1.7 trillion — as investors bet that the company would remain the prime beneficiary of an AI computing boom.
That turned Wednesday’s report into a highly anticipated event for both Wall Street and the technology world, and the numbers — along with the upbeat tone from Huang — renewed confidence that spending would remain strong.
Shares of Advanced Micro Devices Inc, Broadcom Inc and Marvell Technology Inc — three other chipmakers expected to benefit from AI growth — also gained in late trading.
“The entire market is watching this report and expectations have been elevated,” Wolfe Research analyst Chris Caso said in a note.
Guidance was strong enough to “demonstrate continued momentum, while also leaving room for continued upside through the second half,” he said.
On a conference call with analysts, Huang said that demand for Nvidia’s newest products would continue to outstrip supply for the rest of the year.
Though supply is growing, demand is not showing any signs of slowing, he said.
“Generative AI has kicked off a whole new investment cycle,” Huang said.
That would lead to a doubling of the world’s data center installed base over the next five years and “represent an annual market opportunity in the hundreds of billions,” he said.
Nvidia’s profile blew up in the past two years, when its technology proved adept at handling heavy AI workloads. The company’s H100 accelerators have become legendary in the technology world, with customers scrambling to get their hands on as many as possible.
Companies such as Amazon.com Inc, Meta Platforms Inc, Microsoft Corp and Alphabet Inc’s Google are Nvidia’s largest customers, accounting for nearly 40 percent of its revenue, as they rush to invest in hardware for AI computing.
In the fiscal fourth quarter, which ended on Jan. 28, Nvidia’s revenue more than tripled to US$22.1 billion. Profit excluding certain items was US$5.16 a share.
Analysts had predicted sales of about US$20.4 billion and earnings per share of US$4.60.
Underscoring the magnitude of its recent growth streak: As recently as 2021, Nvidia did not generate that much revenue in an entire year.
Nvidia’s data center division, now by far its largest source of sales, generated US$18.4 billion of revenue, up 409 percent from the same period a year earlier. Gaming chips provided US$2.87 billion of sales.
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