Nvidia Beats by $700M, Investors Sell Anyway
Good Morning from San Francisco, Nvidia delivered $46.7 billion in Q2 revenue yet shares dropped 3%. Why? Sequential growth
Explore how Nvidia's strategic bet on AI computing power has led to significant growth and success. Delve into the factors behind this triumph.
Nvidia crushed expectations again, posting a staggering $39.33 billion in quarterly revenue as demand for AI chips continues to surge. The chipmaker's revenue jumped 78% from last year, powered by its data center business which now makes up 91% of total sales.
The company's new Blackwell AI chips are proving to be a game-changer. These chips raked in $11 billion in their first quarter of sales, with major cloud providers snapping them up. CEO Jensen Huang calls the demand "amazing," while CFO Colette Kress labels it "the fastest product ramp" in Nvidia's history.
But it's not all smooth sailing. Gaming revenue dropped 11% to $2.5 billion, falling short of expectations. The company's gross margin also dipped to 73%, down 3% from last year, as newer data center products prove more complex and costly to produce.
Looking ahead, Nvidia forecasts $43 billion in revenue for the next quarter, beating Wall Street's expectations. The company is betting big on AI inference – using models in production rather than just training them. Kress argues that new "thinking" AI models could need 100 times more computing power than current ones.
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