Nvidia, a prominent technology company, has reported a remarkable surge in its sales, more than doubling its revenue due to the soaring demand for its artificial intelligence (AI) chips. The firm’s sales reached an unprecedented high, surpassing $13.5 billion in the three-month period ending in June. This outstanding performance has led the company to project even higher sales in the current quarter. In addition, Nvidia intends to repurchase $25 billion worth of its own stock. As a result of these positive developments, the company’s shares experienced a notable 6.5% increase during after-hours trading in New York, contributing to their substantial gains over the course of the year.
Nvidia anticipates generating approximately $16 billion in revenue for the three months ending in September, a figure that greatly exceeds the expectations of Wall Street analysts. This projection reflects a remarkable growth of around 170% compared to the same period the previous year. Jensen Huang, Nvidia’s CEO, declared the commencement of a new era in computing, characterised by the transition from general-purpose to accelerated computing and generative AI.
The driving force behind Nvidia’s strong performance is its data centre business, which prominently features AI chips. The revenue from this unit soared to more than $10.3 billion, marking a significant increase of over 170% from the previous year.
Nvidia’s stock market valuation has surged to over $1 trillion this year, with its shares experiencing a remarkable three-fold increase in value. This achievement has elevated the company into the ranks of the “Trillion Dollar Club,” alongside other major US companies like Apple, Microsoft, Alphabet, and Amazon.
Sarah Kunst, the managing director of Cleo Capital, expressed fascination with the growing enthusiasm around Nvidia. She highlighted how Nvidia has been manufacturing chips for a substantial period of time, but it’s only recently that the market has truly recognised their significance. Originally known for producing graphics processing units for computer games, Nvidia’s hardware has now become a foundational component for the majority of AI applications.
Nvidia’s impact extends even to AI models like ChatGPT, which was trained using thousands of Nvidia’s graphics processing units. The influence of AI products, including Nvidia’s chips, is expected to revolutionise how we interact with computers and their role in our lives.