When Nvidia published its results for the quarter ending January 31, 2023, it beat Wall Street's revenue expectations by only 0.5%. Back then, revenues amounted to only $6.05 billion and dropped year-on-year by 20.8% (yes, that's the correct number, they dropped by over 20%).
Fast forward a year to the current quarter ending January 31, 2024 and Nvidia beat market expectations by 8.3% (the smallest beat in 3 quarters - see Figure 1) delivering revenues of $22.10 billion - which means an increase of 22.0% sequentially and 265% year on year (and yes, this is also the correct number – see Figure 2).
What does a year mean in the AI industry…
The last year on the AI market was best summed up by Jensen Huang, founder and CEO of NVIDIA: “Accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries and nations.”
Exactly across:
(1) companies,
(2) industries, and
(3) nations (so-called sovereign AI).
Well, we can say that everyone is already investing in AI.
Collete Cress, CFO during the earnings call: “ Countries around the world are investing in AI infrastructure to support the building of large language models in their own language, on domestic data, and in support of their local research and enterprise ecosystems.”
However, the Data Centers business segment is responsible for as much as 92% of the year-on-year revenue growth - see Figure 3.
The NVIDIA Data Center platform is focused on accelerating the most compute-intensive workloads, such as AI, data analytics, graphics and scientific computing.
Jensen Huang, CEO: “Our Data Center platform is powered by increasingly diverse drivers — demand for data processing, training and inference from large cloud-service providers and GPU-specialized ones, as well as from enterprise software and consumer internet companies. Vertical industries — led by auto, financial services and healthcare — are now at a multibillion-dollar level”.
Figure 4 shows the growth in revenues in this segment and the consensus of analysts' estimates for 2024-2025 (both before the publication of the results and after the upward revision made by analysts after the publication of the financial results).
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