Nvidia CEO Jensen Huang made a notable appearance at the launch of the Gefion supercomputer in Denmark on October 23, 2024. The company recently announced its third-quarter earnings, which exceeded analysts’ expectations for both sales and earnings. This robust performance indicates Nvidia’s ongoing growth in an environment where demand for its advanced AI chips remains strong, further cementing its leading position in the tech sector.
In the announcement, Nvidia reported a revenue of $35.08 billion, surpassing the anticipated $33.16 billion, and earnings per share adjusted to 81 cents, compared to a predicted 75 cents. For the current quarter, Nvidia projects sales of approximately $37.5 billion, slightly above the $37.08 billion expected by analysts.
Notably, while this quarter marks a slowdown in annual growth—from 265% last year to an estimated 70% this year—Nvidia still demonstrated impressive revenue growth of 94% year-over-year. This is notable considering the demand for its AI products continues to surge. The company is particularly benefiting from the AI boom, as evidenced by a near tripling of its shares in 2024, making it the most valuable public company globally.
Nvidia’s data center business is the primary driver of this growth, accounting for a significant portion of its revenue at $30.8 billion, a 112% increase year-on-year. In addition to chips, the company also reported $3.1 billion in networking part sales. This underscores the expanding reach of Nvidia’s technology beyond traditional boundaries.
The company’s net income surged to $19.3 billion in this quarter, and its gross margin saw a slight rise to 73.5% thanks to increasing sales of data center chips. On the innovation front, Nvidia has begun shipping its next-generation AI chip, Blackwell, to major clients like Microsoft, Oracle, and OpenAI, with Huang noting that nearly every major technology company is now part of Nvidia’s supply chain.
Looking toward the future, shipments of Blackwell chips are expected to ramp up next year, contributing to projected revenues of “several billion dollars” in the fourth quarter. However, Kress indicated there may be supply constraints, suggesting demand for Blackwell could outstrip availability in the coming quarters. Additionally, Nvidia’s gaming division reported strong growth with $3.28 billion in revenue aided by rising demand for GPUs used in PCs, laptops, and gaming consoles, marking a significant recovery in interest in gaming technology.
Nvidia is also seeing positive momentum in its automotive sector, with revenues climbing 72% to $449 million, driven by increased demand for self-driving car technology. Though smaller than gaming and data center segments, these areas showcase Nvidia’s diverse opportunities for growth.
Huang addressed potential regulatory changes, reassuring that Nvidia will comply with government mandates, demonstrating the company’s commitment to operating within regulatory frameworks.
In summary, Nvidia continues to capitalize on the booming AI market and looks set for sustained growth in various sectors. As it strides into the future, Nvidia’s innovations and expanding partnerships may contribute significantly to the ongoing technological advancement and help shape the landscape of industries reliant on artificial intelligence.
This article reflects the promising trajectory of Nvidia and emphasizes the transformative potential of AI technology as it becomes integral to an expanding range of sectors.