Driven by the high demand for AI products, Nvidia reported a significant increase in revenue and expects exponential growth ahead.
Nvidia Corp (NASDAQ: NVDA) shares closed Wednesday trading at $471.16, up 3.17 percent from the day’s opening price. The NVDA gains extended by about 6.58 percent during the after-hours session to trade at about $502.15. The sudden rise in Nvidia shares was attributed to the announcement of Q2 of fiscal year 2024 financial result that impressed most shareholders. For instance, Nvidia reported a revenue of about $13.51 billion, up approximately 88 percent from the prior quarter, and up over 100 percent from a year ago.
During the second quarter, the tech company reported adjusted earnings per share of about $2.70, whereas analysts surveyed by Refinitiv expected $2.09. Additionally, the analyst surveyed by Refinitiv expected the company to report $11.22 billion.
The company attributed its exemplary performance during the second quarter to a notable increase in demand for generative AI products.
“During the quarter, major cloud service providers announced massive NVIDIA H100 AI infrastructures. Leading enterprise IT systems and software providers announced partnerships to bring NVIDIA AI to every industry. The race is on to adopt generative AI,” Jensen Huang, founder and CEO of Nvidia.
Nvidia Financial Statements in Q2 2024 and Market Outlook
In Q2, Nvidia returned $3.38 billion to shareholders in the form of 7.5 million shares repurchased, and cash dividends. Additionally, the company’s Board of Directors approved an additional $25 billion to facilitate the share repurchases. Moreover, the company expects to continue with the share buyback program this year.
The company announced a Non-GAAP net income of about $6.74 billion during the second quarter up 148 percent QoQ and over 422 percent YoY. Nvidia attributed its immense growth to the unquenchable demand for artificial intelligence products.
“A new computing era has begun. Companies worldwide are transitioning from general-purpose to accelerated computing and generative AI,” Huang added.
Notably, NVIDIA GPUs connected by its Mellanox networking and switch technologies and running the CUDA AI software stack make up the computing infrastructure of generative AI.
Worth noting that the company’s data center revenues made up the lion’s share with about $10.32 billion, up approximately 141 percent from the first quarter, and up over 170 percent from a year ago.
The company’s gaming sector reported revenue of $2.49 billion, up about 11 percent from the previous quarter and up over 20 percent from a year ago. The professional visualization sector reported a revenue of $379 million, up 28 percent from the previous quarter and down 24 percent from a year ago. Nvidia’s automotive sector reported a revenue of $253 million, down 15 percent from the previous quarter and up 15 percent from a year ago.
Forward, the company expects to report a revenue of about 16.00 billion, plus or minus 2 percent, during the third quarter of fiscal year 2024.