Nvidia Record Quarterly Revenue in Gaming, Data Center, and Professional Visualization

NVidia beat both earnings and revenue expectations in the third quarter of 2021. Revenue for the third quarter was a record $7.10 billion, up 50 percent from a year earlier. Record quarterly revenue was achieved in Gaming, Data Center, and Professional Visualization. Gaming revenue was up 42 percent from a year ago and up 5 percent sequentially

NVidia GeoForce

Q3 2021 Earnings

NVDA reported adjusted earnings per share of $1.17 and revenue of $7.1 billion. Analysts expected $1.11 earnings per share and revenue of $6.82 billion. Earning per share rose 60% year-over-year and revenue was up 50% from a year ago. Nvidia also said it expects $7.4 billion in revenue in the current quarter, beating the $6.86 billion forecasted by analysts.

A highlight was $2.9 billion in data center sales, up 55% from the year-ago quarter. More customers are seeking out Nvidia’s chips for artificial intelligence applications like understanding human speech among other uses.

Revenue

Revenue for the third quarter was a record $7.10 billion, up 50 percent from a year earlier. Record quarterly
revenue was achieved in Gaming, Data Center, and Professional Visualization.

Gaming revenue was up 42 percent from a year ago and up 5 percent sequentially, reflecting higher sales of
GeForce GPUs. We benefited from strong demand for our NVIDIA Ampere architecture products leading into
the holiday season. Nearly all our desktop Ampere architecture GeForce GPU shipments are Lite Hash Rate in
our effort to direct GeForce to gamers.

Data Center revenue was up 55 percent from a year ago and up 24 percent sequentially, driven by sales of
NVIDIA Ampere architecture products to hyperscale customers for cloud computing and workloads such as
natural language processing and deep recommender models, as well as to vertical industries.

Professional Visualization revenue was up 144 percent from a year earlier and up 11 percent sequentially,
driven by NVIDIA Ampere architecture products, with growth in desktop and notebook workstation GPUs as
enterprises deploy systems to support hybrid work environments.

Automotive revenue was up 8 percent from a year earlier and down 11 percent sequentially. The year-onyear growth was due to the ramp of self-driving programs, while the sequential decline was related to
automotive makers’ supply constraints.

OEM and Other revenue was up 21 percent from a year ago and down 43 percent sequentially. The year-onyear growth reflects Cryptocurrency Mining Processor (CMP) revenue of $105 million in this quarter. The
sequential decline primarily reflects lower CMP revenue.

Our GPUs are capable of digital currency mining, though we do not have visibility into how much this impacts
our overall GPU demand. Volatility in the cryptocurrency market, including changes in the prices of
cryptocurrencies, can impact demand for our products and our ability to estimate demand for our products

Pending Acquisition of Arm Limited

The acquisition of Arm Limited is subject to customary closing conditions, including receipt of specified
governmental and regulatory consents and approvals and the expiration of any related mandatory waiting
period, and Arm’s implementation of the reorganization and distribution of Arm’s IoT Services Group and
certain other assets and liabilities.

We are seeking regulatory approval in the United States (US), the United Kingdom (UK), the European Union
(EU), China and other jurisdictions. Regulators at the US Federal Trade Commission (FTC) have expressed
concerns regarding the transaction, and we are engaged in discussions with the FTC regarding remedies to
address those concerns.

The transaction has been under the review of China’s antitrust authority, pending the
formal case initiation.

Regulators in the UK and the EU declined to approve the transaction in Phase 1 of their review processes, expressed numerous concerns, began a more in-depth Phase 2 review on the transaction’s impact on competition, and, in the UK, a Phase 2 review of the impact on the UK’s national security interests. Although regulators and some Arm licensees have expressed concerns or objected to the transaction, we continue to believe in the merits and benefits of the acquisition to Arm, its licensees, and the industry.


Fourth Quarter of Fiscal 2022 Outlook

  • Revenue is expected to be $7.40 billion, plus or minus 2 percent.
  • GAAP and non-GAAP gross margins are expected to be 65.3 percent and 67.0 percent, respectively, plus or minus 50 basis points.
  • GAAP and non-GAAP operating expenses are expected to be approximately $2.02 billion and $1.43 billion, respectively.
  • GAAP and non-GAAP other income and expense are both expected to be an expense of approximately $60 million, excluding gains and losses from non-affiliated investments.
  • GAAP and non-GAAP tax rates are both expected to be 11 percent, plus or minus 1 percent, excluding any discrete items such as excess tax benefits or deficiencies related to stock-based compensation.
  • Capital expenditures are expected to be approximately $250 million to $275 million, including principal payments on property and equipment.

Source: NVidia, AlphaStreet

From The TradersCommunity Research Desk