The business of the chip company Nvidia continues to grow explosively due to the AI boom. In the last quarter, sales rose from $7.2 billion the previous year to $26 billion – an increase of 262 percent. And demand remains strong: Nvidia’s new chip systems are expected to experience bottlenecks well into the coming year.
Nvidia technologies were originally developed for graphics cards. But then it turned out that they are also ideal for computing work when training applications with artificial intelligence. Nvidia’s chips have thus become a key technology for the future of AI – and the group also benefits from business with associated software and services.
Nvidia technology is now no longer only used in training, but also in the operation of AI applications, emphasized CEO Jensen Huang. There is potentially an even more stable business in this. Although training requires enormous computing power, it is only necessary once per AI model. At the same time, Huang assumes that in the future AI will generate all kinds of content that is currently retrieved from databases.
“New Industrial Revolution”
Business with technology for data centers grew particularly strongly in the last quarter. At $22.6 billion, sales were more than five times higher than a year ago, as Nvidia announced after the US stock market closed. Even within three months it was still an increase of 23 percent. Huang spoke of a “new industrial revolution” in a conference call with analysts. A new type of data center is emerging: “AI factories”.
Nvidia now wants to introduce a new generation of its chips every year, said Huang. In March, he introduced the “Blackwell” chip system. It is currently being produced and the first devices are expected to be delivered to customers in the coming months. “Blackwell” is much more powerful than the previous “Hopper” generation – and not only tech giants such as Facebook’s Meta and Amazon’s cloud division AWS are on the customer list.
Sales increase to 28 billion dollars expected
For the current quarter, the group announced a further increase in sales to $28 billion – while analysts on average had expected a forecast of just under $27 billion.
Nvidia also operates the “Omniverse” platform, through which companies can better control their factories using so-called digital twins, and supplies Mercedes, among others, with car computers for driving assistance functions.
Nvidia’s quarterly profit jumped from a good $2 billion to just under $14.9 billion year-on-year. The share rose by a good six percent in after-hours US trading and exceeded the $1,000 mark for the first time. Nvidia also announced a dividend increase and a 1-for-10 stock split.