Surprise: Nvidia topped estimates and guided ahead of consensus for current-quarter revenue in hotly-anticipated results released on Wednesday afternoon in the US.
The company’s quarterly update was widely viewed as a make-or-break moment for a wild run-up in semiconductor stocks, which at one point last week traded at a wider premium to their 200-day moving average than the Nasdaq at the height of the tech bubble.
Revenue last quarter was $81.62 billion, Nvidia said Wednesday. That was well ahead of the $78.85 billion consensus expected and up 85% YoY.
The current-quarter guide is $91 billion. That’d equate to 95% YoY growth, likewise better than analysts saw headed in. Notably, that assumes no revenue from the Chinese market.
Jensen Huang engaged in the usual hyperbole and self-aggrandizing. “The buildout of AI factories — the largest infrastructure expansion in human history — is accelerating at extraordinary speed,” he declared. “Nvidia is uniquely positioned at the center of this transformation as the only platform that runs in every cloud, powers every frontier and open source model, and scales everywhere AI is produced.”
Gross margin of 75% was in line for Q1, and the company expects a similar result this quarter. The board approved another $80 billion in buybacks and the company said it’s upping the dividend to $0.25.
Going forward, Nvidia’s going to split its numbers into two “market platforms” in a shakeup of how it reports quarterly results. There’ll be Data Center (which’ll house hyper-scaler revenue as well as sales associated with “AI factories across industries and countries”) and “Edge Computing” (which’ll include revenue from “data processing devices for agentic and physical AI including PCs, game consoles, workstations, robotics and automotive”).
The new reporting structure will “better reflect” Nvidia’s “current and future growth drivers,” the company said.
This goes without saying, but Nvidia’s so damn big now that the stock has very little hope of enjoying the kind of meteoric gains observed in other semi names this year.
Although Alphabet briefly challenged Nvidia for the title of world’s most valuable company this month, Huang’s behemoth was back on top as of mid-week, worth $5.4 trillion ahead of earnings.
It’s worth noting that Nvidia actually isn’t expensive, at least when expressed as a multiple of company analysts’ collective profit forecasts. Thanks to upgraded expectations, the stock trades at just 24x, not that much richer than the benchmark it dominates, and more than 10 turns cheaper than its own 10-year average.
In any event, the linchpin of what many believe is a technological epoch on par with human history’s most consequential breakthroughs is still capitalizing quite handsomely on the revolution it started. Sales growth is reaccelerating and may well reach triple-digits again in the current quarter, it’s buying back more stock and it’s raising the dividend.
I’m not sure what else you could possibly want as a shareholder, but I’ll leave it up to “efficient” markets to determine whether the quarter (and guide) were good enough to warrant a rally. Or if the bar’s simply too high to clear these days regardless of how objectively impressive a given quarter’s numbers turn out.
