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Nvidia Sees Boost in Shares Following Strong Q2 Results

Nvidia shares surged by 6% after-market on Wednesday as it exceeded fiscal second-quarter expectations and projected a bullish outlook for the following quarter.

Q2 Highlights:

  • Earnings: Nvidia posted $2.70 per share, surpassing the $2.09 expected by Refinitiv.

  • Revenue: The chipmaker reported $13.51 billion in revenue, well beyond Refinitiv’s prediction of $11.22 billion.

  • Net Income: The company witnessed a massive leap in net income to $6.19 billion from the previous year's $656 million.

For the upcoming fiscal third quarter, Nvidia forecasts revenues around $16 billion, a marked 170% growth year-over-year, outpacing the Refinitiv forecast of $12.61 billion.

The marked rise in sales highlights the pivotal role Nvidia’s GPUs play in driving the AI revolution. Crucial AI chips like Nvidia’s A100 and H100 power AI platforms, including OpenAI's ChatGPT.

Year-over-Year Growth:

  • Q2 revenues shot up from $6.7 billion the previous year, marking an 88% hike from the last period.

During a conversation with analysts, Nvidia CEO Jensen Huang emphasized the shift of the trillion-dollar data centers towards accelerated computing and generative AI.

Addressing potential export restrictions from the Biden administration, CFO Colette Kress conveyed confidence in the global demand for their products, downplaying any immediate significant impact on their finances.

Before this recent update, Nvidia's stock price had already tripled over the year, securing its position as the leading performer in the S&P 500. The stock soared to approximately $500 post-market, potentially setting a new record if it maintains this during Thursday's close.

Business Segments:

  • Data Center: A pivotal growth driver, it reported $10.32 billion, a 171% increase year-over-year.

  • Gaming: Nvidia's foundational business recorded a 22% rise in revenue year-over-year at $2.49 billion.

  • Graphics Applications: This sector faced a 24% dip year-over-year, bringing in $379 million.

  • Automotive: The automotive chip sector brought in $253 million, marking a 15% growth from the prior year.

Lastly, Nvidia announced a massive $25 billion share buyback authorization, following its $3.28 billion share purchase in the quarter.


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