Nvidia Lives Up to the Hype, Delivers Another Huge Quarter

Ever since Nvidia first revealed to the world how much it expects to profit from the rise of artificial intelligence in May 2023, the chipmaker has been the poster child of the AI-fueled stock market rally that has propelled the S&P 500 to historic highs. So much so, in fact, that each of the company's earnings releases since then has been considered a make-or-break moment for market momentum, with investors around the world biting their nails, hoping for more positive news from the company that quite literally powers the AI revolution. And so far, Nvidia has always delivered. On Wednesday, the company reported fourth-quarter results that not only met its bullish outlook from three months ago, but blew past it. Perhaps more importantly though, the company‘s outlook for the ongoing quarter promises more of the same, i.e. another jump in revenue at a very high gross margin.

In the three months ended January 29, 2024, Nvidia's revenue jumped 265 percent from the same period a year ago, reaching $22.1 billion compared to its own outlook of $20 billion. Once again, Nvidia's data center business was at the heart of the company's blowout quarter, as it saw a 409-percent jump in revenue versus a year ago and accounted for more than 80 percent of total sales. Net income amounted to $12.3 billion in the past quarter, exceeding the full-year profit for fiscal 2023 by more than 100 percent thanks to a gross margin of 76 percent.

“Accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries and nations,” Jensen Huang, founder and CEO of Nvidia said in a statement on Wednesday. "Our Data Center platform is powered by increasingly diverse drivers — demand for data processing, training and inference from large cloud-service providers and GPU-specialized ones, as well as from enterprise software and consumer internet companies. Vertical industries — led by auto, financial services and healthcare — are now at a multibillion-dollar level," he added.