On May 23, Nvidia shares set a new record after announcing better-than-expected first quarter business results.
Nvidia dominates the global AI chip market. Photo: Reuters
Closing the trading session on May 23, Nvidia shares increased more than 9% after the company announced business results that beat Wall Street’s predictions, showing that there is still strong demand for AI chips. For the first time, Nvidia stock price exceeded the 1,000 USD mark, reaching 1,307.99 USD, increasing capitalization to 2.55 trillion USD. The highest price recorded was 953.86 USD on May 21.
According to CEO Jensen Huang, Nvidia will start to generate large revenue from the new generation AI chip, Blackwell, from the end of this year. In the three-month period ending April 28, the world’s largest semiconductor manufacturer achieved revenue of 26.04 billion USD, net income of 14.88 billion USD.
Over the past year, Nvidia’s revenue has skyrocketed as businesses like Google, Microsoft, Meta, Amazon and OpenAI bought billions of dollars of its GPUs to develop and deploy AI applications. Nvidia’s most important and largest business is data centers, which include AI chips as well as many other components needed to operate large AI servers.
Nvidia said revenue in this segment increased 427% from a year ago to $22.6 billion. Chief Financial Officer Colette Kress explained the results thanks to the Hopper line of graphics chips, including the H100.
During the call with analysts, Kress shared that the highlight of the quarter was Meta’s announcement of its latest Lama 3 large language model, using 24,000 H100 GPUs. Besides, major cloud providers contribute about 40% of Nvidia data center revenue.
Nvidia’s networking components division also recorded strong sales, reaching $3.2 billion. Before becoming a leading supplier for AI businesses, Nvidia was famous for making hardware for 3D games. Game revenue increased 18% in the same period, to 2.65 billion USD.
Jensen Huang’s company also sells chips for cars and chips for advanced graphics workstations. These two segments recorded revenue of 329 million USD and 427 million USD, respectively.
(Theo CNBC)