U.S. graphics processor maker Nvidia Corp. increased its net profit in its fiscal second quarter by 1.6 times, revenue also by 1.6 times, to another record.
The company’s adjusted earnings and revenue beat market forecasts, but revenue growth in the data centre segment, which accounts for 89% of Nvidia’s sales, fell short of expectations for the second consecutive quarter.
According to Nvidia’s press release, net income for the quarter ended 27 July was $26.42 billion, compared to $16.6 billion in the comparable period of the previous year. Earnings per share rose to $1.08 from $0.67 a year earlier. Adjusted earnings came in at $1.05 per share, beating the consensus forecast of $1.01 per share from analysts surveyed by FactSet.
The company’s quarterly revenue rose to $46.74 billion from $30.04 billion a year earlier, with experts’ average forecast of $46.05 billion.
Revenue in the data centre segment increased by 56% to $41.1bn, which was slightly below market expectations ($41.3bn). The company’s revenue in the gaming business increased 49% to $4.3bn.
According to Nvidia’s forecast, its revenue in the current quarter will be $54bn plus or minus 2% (market forecast – $53.43bn). The company does not include shipments of H20 chips to China in this forecast. There were no H20 sales to Chinese customers in the second fiscal quarter either, the company said in a press release.
Nvidia CEO Jensen Huang has made it clear that he does not fear the end of the AI boom and demand for AI development chips. He expects opportunities for this market to continue to grow over the next five years.
Demand for Nvidia’s latest Blackwell chips was 17 per cent higher last quarter than the previous quarter, Huang noted, calling demand “extremely strong”. He named Walt Disney Co., Hitachi, Hyundai Motor and SAP among the customers for the chips.
In the first financings, Nvidia returned $24.3bn to shareholders in the form of buybacks and dividend payments. The company still has $14.7bn left to buy back shares under its existing share buyback programme. The Board of Directors approved the allocation of another $60bn for buyback.
Nvidia shares fell 3.1 per cent in additional trading on Wednesday. Since the beginning of this year, their value has risen by 35%.