A new generation of gaming chips, along with continued heavy demand for a wide range of digital services during the pandemic, lifted Nvidia’s revenue and earnings above expectations in the latest quarter.
The US chipmaker also issued a financial forecast for the current period that was well above Wall Street’s hopes as it anticipated continued strong sales of its new Ampere chip architecture.
Nvidia’s recent growth spurt has been fed by huge demand from data centre customers, who use its graphical processing units to boost the performance of their machine learning systems. Data centre sales topped gaming — Nvidia’s traditional business — for the first time earlier this year and capped a stock market rally that has made it the world’s most valuable chipmaker.
On Wednesday, though, Nvidia revealed that demand for its Ampere chips in gaming personal computers and consoles accounted for its latest quarter of outperformance. A 37 per cent jump in gaming revenue from the preceding three months — a bigger bounce than the 25 per cent the company had predicted — lifted sales of these products to $2.27bn.
That topped the $1.9bn of data centre sales, representing 8 per cent sequential growth. However, the data centre market still underpinned Nvidia’s robust year-on-year performance, with sales in this segment jumping by 162 per cent, close to the growth rate seen in the preceding quarter.
Overall, Nvidia’s revenue growth rate accelerated to 57 per cent, 2 percentage points higher than the previous quarter and its strongest growth in two and a half years. Revenue of $4.73bn beat analysts’ expectations of $4.41bn.
Pro forma earnings per share, at $2.91, were up 63 per cent from the year before and 34 cents above expectations. Based on formal accounting principles — and taking into account acquisition-related costs and employee stock compensation — earnings per share rose 46 per cent, to $2.12.