Nvidia Q1 Boosts Profits With AI
Nvidia (NVDA) shared its earnings for the first quarter on Wednesday. They surpassed the predictions of experts in both profit and revenue due to its data center business. The company also anticipates an income of around $11 billion for Q2 with a margin of error of 2%, but experts were guessing $7.2 billion.
Nvidia is popular for AI because of its strong graphics cards and server products. This makes the stock price go up. Last year, Nvidia's shares increased by 77%. In comparison, AMD's shares went up by 12%. Intel's shares decreased by 30% in the same time.
Bloomberg made a rundown of important numbers from the report. These numbers were then compared to expected values.
Revenue earned was $7.2 billion, which was more than the expected $6.5 billion.
The Adj. EPS is $1.09. Normally, it was expected to be $0.92. This is surprising news. The EPS shows how much money a company earns for each share of stock. Therefore, a higher EPS is better for investors.
The gaming industry made $2.2 billion. This was more than the expected $1.9 billion. This is a lot of money. It shows that gaming is a profitable industry.
The data center cost $4.2 billion. This was more than the expected $3.9 billion. There was a difference of $300 million. The data center was expensive.
When they made the announcement, Nvidia's shares went up by over 13%.
Nvidia CEO Jensen Huang said two things are happening in the computer industry. These things are accelerated computing and generative AI.
Companies are in a hurry to include generative AI in every product, service and business process. They plan to do so by transitioning a trillion dollars of installed global data center infrastructure from general purpose to accelerated computing.
Nvidia's stocks are surging with AI being popular. The introduction of OpenAI’s ChatGPT and Microsoft (MSFT) and Google’s (GOOG, GOOGL) own generative AI efforts is responsible. Nonetheless, the company is still dealing with a downturn in the gaming industry.
Many people are buying fewer electronics now. This is because there was a big surge in electronics sales during the pandemic. People were stuck at home, so they bought things like graphics cards and computers to keep themselves entertained.
Gamers don't need to upgrade systems yet. Intel and AMD are also facing client computing group difficulties.
Nvidia will announce its first-quarter profits on Wednesday. This happens after the stock market closes. The announcement is eagerly awaited by investors. Mike Blake from REUTERS took a picture of the company's headquarters.
The decline of Nvidia's gaming business is expected to end soon. Wall Street thinks that Nvidia will see growth in Q2, which would help make up for the three consecutive quarters of decline.
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Nvidia's data center business is doing well. The company reported a 14% growth in revenue.
Yahoo Finance's tech editor is Daniel Howley. He's been writing about technology since 2011. You can follow him on Twitter as @DanielHowley.
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