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Earnings Results: Nvidia profit doubles, and execs see ‘accelerated growth’ ahead despite supply-chain concerns

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Nvidia Corp. shares were placid in the extended session Wednesday after the chip maker’s holiday quarter breezed past Wall Street’s and its own expectations, posting record sales and doubling its profits from a year ago.

Nvidia
NVDA,
+0.06%

shares slipped 1% after hours, following a less than 0.1% advance in the regular session to close at $265.11. Shares closed at a split-adjusted all-time high of $333.76 on Nov. 29. All share and per-share figures are presented as split-adjusted.

Nvidia reported fourth-quarter net income of $3 billion, or $1.18 a share, compared with $1.46 billion, or 58 cents a share, in the year-ago period. Adjusted earnings, which exclude stock-based compensation expenses and other items, were $1.32 a share, compared with 78 cents a share in the year-ago period.

Revenue surged to a record $7.64 billion, up 53% from $5 billion in the year-ago quarter. Analysts surveyed by FactSet had estimated adjusted earnings of $1.23 a share on revenue of $7.42 billion. Nvidia executives forecasted revenue between $7.25 billion and $7.55 billion in November.

Back in mid-November, Nvidia reported quarterly records across the board — $3.22 billion in gaming sales, $2.94 billion in data-center sales, and $7.1 billion in total sales — much to Wall Street’s celebration. Nvidia had also forecast data-center sales to grow faster sequentially than gaming sales in the fourth quarter. A year and a half ago, sales of data-center chips surpassed gaming sales for the first time, but that soon switched back.

Read: Nvidia seeks to lead gold rush into the metaverse with new AI tools

“We are entering the new year with strong momentum across our businesses and excellent traction with our new software business models with Nvidia AI, Nvidia Omniverse and Nvidia Drive,” said Nvidia Chief Executive Jensen Huang in a statement. “GTC is coming. We will announce many new products, applications and partners for NVIDIA computing.”

In the fourth quarter, gaming sales rose 37% to a record $3.42 billion from the year-ago quarter, or for a sequential gain of 6%. Meanwhile, analysts surveyed by FactSet had expected Nvidia gaming sales of $3.36 billion.

“The year-on-year increases for the quarter and fiscal year reflect higher sales of GeForce GPUs,” said Colette Kress, Nvidia’s chief financial officer, in a statement. “We continue to benefit from strong demand for our Nvidia Ampere architecture products. The sequential increase for the quarter from GeForce GPUs was partially offset by a seasonal decrease in game console SOCs.”

On the data-center side, sales surged 71% to a record $3.26 billion from the year-ago quarter, or for a sequential quarterly gain of 11%, while analysts expected sales of $3.18 billion.

“These increases were primarily driven by sales of Nvidia Ampere architecture GPUs across both training and inference for cloud computing and AI workloads such as natural language processing and deep recommender models,” Kress said in a statement

For more: Look back at earnings results from Intel as well as AMD

For the first, or current, quarter, the Santa Clara, Calif.-based chip maker expects revenue of $7.94 billion to $8.26 billion, while analysts have forecast revenue of $7.31 billion on average.

The earnings report comes a week after Nvidia’s $40 billion bid to acquire chip designer Arm Ltd. officially unraveled, much to Wall Street’s lack of surprise.

Recently, Nvidia pushed past Facebook parent Meta Platforms Inc.
FB,
-2.02%

for the title of seventh largest publicly traded U.S. company by market cap.

Over the past 12 months, Nvidia shares were up 73% by Wednesday’s close, while the PHLX Semiconductor Index 
SOX,
+0.03%

rose 10% over that period. Meanwhile, the S&P 500 index 
SPX,
+0.09%

gained 14%, and the Nasdaq Composite Index
COMP,
-0.11%

was up less than 1%.

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