Nvidia marvels by increasing revenues by 262% and profits by 628% due to artificial intelligence | Companies

Nvidia marvels by increasing revenues by 262% and profits by 628% due to artificial intelligence | Companies
Nvidia marvels by increasing revenues by 262% and profits by 628% due to artificial intelligence | Companies

Nvidia’s first quarter results presentation a year ago marked a before and after in the company’s history. In 12 months, the value of its shares has tripled in the heat of demand for its powerful microprocessors due to the artificial intelligence fever. The accounts for the first quarter of the company’s current fiscal year (from February to April) confirm this leap that has taken the company to the podium of large listed companies, only behind Microsoft and Apple. Revenues skyrocketed by 262%, to 26,044 million dollars (about 24,070 million euros at the current exchange rate) and profits multiplied by more than seven, going from 2,043 to 14,881 million, an increase of 628%.

The shares have reacted upwards, but only moderately, since expectations were already very high and the company has already accumulated a spectacular revaluation. After skyrocketing and hovering around 1,000 titles per share, the company has announced a split (split) of each share by 10, which will lower its nominal price, “to make the shares more accessible to employees and investors,” he said. Economically, it is a neutral operation, but it is usually well received by the market.

Those of the first quarter are, of course, record results, as are those of the last quarters. In February, after presenting spectacular annual results, Nvidia forecast revenues of around $24 billion for the first quarter of this year, with gross margins of 76.3%. It has surpassed those figures. For the second quarter, it has reported that it expects to bill around $28 billion with a gross margin of 74.8%. The pace of growth is going to slow down as it begins to be compared with quarters in which the artificial intelligence (AI) fever had already taken effect. In its second quarter of last year it had a turnover of 13.51 billion dollars.

In the first quarter, the data center business continues to be the driver of revenue, with $22,563 million, a figure that is more than five times that of a year ago. This division already accounts for 87% of the company’s turnover, compared to 60% in the first quarter of last year.

“The next industrial revolution has begun: companies and countries are partnering with Nvidia to change traditional trillion-dollar data centers for accelerated computing and build a new type of data center, AI factories, to produce a new raw material: artificial intelligence,” said Jensen Huang, founder and CEO of Nvidia in a statement. “AI will bring significant productivity improvements to almost all industries and help companies become more cost and energy efficient, while expanding revenue opportunities,” he added.

Growth in the data center microprocessor business has been driven by strong and accelerating demand for generative AI training and inference, the company said. Beyond cloud service providers, generative AI has expanded to consumer internet companies and enterprise customers, automotive, healthcare and even states, creating multiple multi-billion dollar vertical markets. “We are prepared for our next wave of growth,” said Huang.

The company with the green eye logo is the big winner of the artificial intelligence fever, as it designs the most powerful microprocessors. The insatiable demand for its products has grown exponentially with the high computing needs associated with generative artificial intelligence. Intel, Samsung and the tech giants are developing their own microprocessors for artificial intelligence, but Nvidia is several steps ahead.

Its H100 accelerators are the benchmark to beat and customers are rushing to get as many of them as possible. “Right now it is much more difficult to get GPUs [microprocesadores gráficos de gran potencia] what drugs,” said Elon Musk a few months ago. “That’s not saying much in San Francisco, though,” he joked. Microsoft, Amazon, Google, Apple, Oracle, OpenAI, Anthropic are Nvidia clients, as are robotics, autonomous driving and biotechnology firms.

Founded in a fast food restaurant in San Jose, California, in 1993, Nvidia was a pioneer in graphics processing for computers and video game consoles. In 1999, he invented the GPU, the graphics processing unit, which laid the foundations for a profound change in the sector. To have increasingly better images, the power of its processors was exponentially increasing, with capabilities for robotics, cloud computing, the aerospace industry, weapons manufacturing, the metaverse, cryptocurrencies, autonomous driving, recognition of images and artificial intelligence, which has given it the definitive push in the last year.

Jensen Huang, 61, founded the company with Chris Malachowsky and Curtis Priem, with the vision of bringing 3D graphics to the gaming and multimedia markets. He has led it since then and has become the head of a large company with the longest history in all of Silicon Valley. When the three founded the company at Denny’s, where Huang ate his first hamburger and tried his first milkshake and where he started working as a dishwasher as a teenager, the three friends didn’t know what to name it and started calling it NV, initials of next version, or next version. Therefore, when searching for the final name they looked for words that began with the letters nv. Finally, from Latin envy (envy) they deleted the first letter.

[Noticia de última hora. Habrá actualización en breve]

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