Nvidia Reports 34% Increase In Q3 Revenue; Expects Trend To Continue In Q4 -

Nvidia Reports 34% Increase In Q3 Revenue; Expects Trend To Continue In Q4

Nov 22, 2023Jeremy ParkinsonFinance0

Image Source: Pixabay
Nvidia Corporation (NVDA) released its financial results yesterday for the third quarter ended October 29th, 2023.

Q3 Financial Highlights
(The information below compares Q3 2024 with Q2 2024 and all figures are in U.S. dollars.)

Revenue: UP 34% to $18,120M

Gross Margin: UP to 74.0% from 70.1%

Operating Expenses: UP 12% to $2,983M

Operating Income: UP 53% to $10,417

Net Income: UP 49% to $9,243M

Q3 Operating Highlights
NVIDIA achieved progress since its previous earnings announcement in these areas:

Data Center

Third-quarter revenue was UP 41% from the previous quarter and up 279% from a year ago.
Announced NVIDIA HGX™ H200 with the new NVIDIA H200 Tensor Core GPU, the first GPU with HBM3e memory, with systems expected to be available in the second quarter of next year.
Introduced an AI foundry service, with NVIDIA AI Foundation Models, NVIDIA NeMo™ framework and NVIDIA DGX™ Cloud AI supercomputing, to accelerate the development and tuning of custom generative AI applications, first available on Microsoft Azure, with SAP and Amdocs among the first customers.
Announced the integration of NVIDIA Spectrum-X™ Ethernet networking platform for AI into servers from Dell Technologies, Hewlett Packard Enterprise and Lenovo in the first quarter of next year.
Announced that NVIDIA GH200 Grace Hopper Superchips, including a new quad configuration, will power more than 40 new supercomputers, including the JUPITER system at Jülich Supercomputing Centre and Isambard-AI at the University of Bristol.
Made advances with global cloud service providers:
- Google Cloud Platform made generally available new A3 instances powered by NVIDIA H100 Tensor Core GPUs and NVIDIA AI Enterprise software in Google Cloud Marketplace.
- Microsoft Azure will be offering customers access to NVIDIA Omniverse™ Cloud Services for accelerating automotive digitalization, as well as new instances featuring NVL H100 Tensor Core GPUs and H100 with confidential computing, with H200 GPUs coming next year.
- Oracle Cloud Infrastructure made NVIDIA DGX Cloud and NVIDIA AI Enterprise software available in Oracle Cloud Marketplace.
- Partnered with a range of leading companies on AI initiatives, including Amdocs, Dropbox, Foxconn, Genentech (member of Roche Group), Infosys, Lenovo, Reliance Industries, Scaleway and Tata Group.
- Announced record-setting performance in the latest two sets of MLPerf benchmarks for inference and training, with the NVIDIA Eos AI supercomputer training a GPT-3 model 3x faster than the previous record.
- Announced growing worldwide support for the NVIDIA^® CUDA^® Quantum platform, including new efforts in Israel, the Netherlands, the U.K. and the U.S.

Gaming

Third-quarter revenue was UP 15% from the previous quarter and up 81% from a year ago.
Launched DLSS 3.5 Ray Reconstruction, which creates high-quality ray-traced images for intensive ray-traced games and apps, including Alan Wake 2 and Cyberpunk 2077.
Released TensorRT-LLM™ for Windows, speeding on-device LLM inference by up to 4x.
Added 56 DLSS games and over 15 Reflex games, bringing the total number of RTX games and applications to over 475.
Surpassed 1,700 games on GeForce NOW™, including launches of Alan Wake 2, Baldur’s Gate 3, Cyberpunk 2077: Phantom Liberty, Forza Motorsport and Starfield.

Professional Visualization

Third-quarter revenue was UP 10% from the previous quarter and up 108% from a year ago.
Announced that Mercedes-Benz is using NVIDIA Omniverse to create digital twins to help plan, design, build and operate its manufacturing and assembly facilities around the world.
Announced a new line of desktop workstations with NVIDIA RTX™ 6000 Ada Generation GPUs and NVIDIA ConnectX® smart interface cards for training smaller AI models, fine-tuning models and running inference locally.

Automotive

Third-quarter revenue was UP 3% from the previous quarter and up 4% from a year ago.
Furthered its collaboration with Foxconn to develop next-generation electric vehicles for the global market, using the next-generation NVIDIA DRIVE Hyperion™ platform and NVIDIA DRIVE Thor™ system-on-a-chip.

Management Commentary
Jensen Huang, founder and CEO, said:

“Our strong growth reflects the broad industry platform transition from general-purpose to accelerated computing and generative AI. Large language model startups, consumer internet companies and global cloud service providers were the first movers, and the next waves are starting to build. Nations and regional CSPs are investing in AI clouds to serve local demand, enterprise software companies are adding AI copilots and assistants to their platforms, and enterprises are creating custom AI to automate the world’s largest industries. NVIDIA GPUs, CPUs, networking, AI foundry services and NVIDIA AI Enterprise software are all growth engines in full throttle. The era of generative AI is taking off.”

Q4 Outlook

Revenue is expected to be $20.00 billion, plus or minus 2%.

GAAP and non-GAAP gross margins are expected to be 74.5% and 75.5%, respectively, plus or minus 50 basis points.

GAAP and non-GAAP operating expenses are expected to be approximately $3.17 billion and $2.20 billion, respectively.

GAAP and non-GAAP other income and expense are expected to be an income of approximately $200 million, excluding gains and losses from non-affiliated investments.

GAAP and non-GAAP tax rates are expected to be 15.0%, plus or minus 1%, excluding any discrete items.

Stock Performance
Nvidia’s stock price was UP 241.75% YTD as of the close of the market yesterday.

Media Commentary

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Nvidia Stock In Buy Zone As AI Chip Boom Drives 593% Earnings Growth — Is It A Buy?

Nvidia lower restricted AI China sales cloud blowout Q3 earnings

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