Nvidia posted earnings for its fiscal Q3 (ended October 29), and its performance surpassed analyst expectations yet again.
Strong demand for the company’s graphic processing chips, which are used in gaming and data centers, as well as the accelerating adoption of artificial intelligence (AI) and driverless cars, largely drove growth during the quarter.
The graphics chip designer reported record revenue of $2.6 billion, up 32% year-over-year (YoY) from $2 billion, and up 18% from the $2.2 billion it posted in the previous quarter.
Nvidia’s gaming and cloud segments were the primary drivers of the company’s solid Q3, and will likely remain areas of high growth for the company as it secures its position as a leader in AI.
- Its graphics chips continue to be central to the company’s gaming business.Nvidia’s gaming revenue jumped 25% YoY to $1.56 billion, accounting for nearly 60% of total revenue. Nvidia provides the main chip for the Nintendo Switch game console, and its GeForce chips power gaming PCs. Nvidia will likely see even more growth in this segment as adoption of immersive VR gaming technologies take off. That’s because VR requires massive processing power that Nvidia’s chips can support.
- Nvidia’s graphics chips have become crucial to the future of cloud computing.Revenue from Nvidia’s data centers business, its second-largest revenue generator, spiked 109% YoY to $501 million, from $240 million. The cloud computing market presents massive revenue potential for Nvidia — the global market is expected to jump 58% to $411 billion by 2020 from an estimated $260 billion in 2017, according to Gartner. Nvidia CEO Jensen Huang said the company’s Volta GPU, which enables developers and clients to Read More Here