NVDA

Nvidia's AI-Powered Earnings, Revenue, and Guidance Easily Exceed Expectations...Again

Shares of Nvidia (NASDAQ: NVDA) jumped 9.1% in after-hours trading on Wednesday following the graphics chip specialist's release of a powerful report for the fourth quarter of fiscal 2024 (ended Jan. 28).

The stock's rise is largely attributable to the quarter's revenue and earnings handily beating Wall Street's expectations, along with first-quarter fiscal 2025 guidance for both the top and bottom lines sprinting by the analyst consensus estimates.

Nvidia's key quarterly numbers

Metric Fiscal Q4 2023 Fiscal Q4 2024 Change YOY
Revenue $6.05 billion $22.10 billion 265%
GAAP operating income $1.26 billion $13.62 billion 983%
GAAP net income $1.41 billion $12.29 billion 769%
Adjusted net income $2.17 billion $12.84 billion 491%
GAAP earnings per share $0.57 $4.93 765%
Adjusted earnings per share $0.88 $5.16 486%

Data source: Nvidia. YOY = year over year. GAAP = generally accepted accounting principles. Fiscal Q4 2024 ended on Jan. 28, 2024.

Investors should focus on the adjusted numbers because they exclude one-time items.

Wall Street was looking for adjusted earnings per share (EPS) of $4.63 on revenue of $20.62 billion, so Nvidia breezed by both expectations. It also surpassed its own guidance for adjusted EPS of $4.46 on revenue of $20 billion.

Platform performance

Platform Fiscal Q4 2024 Revenue Change YOY Change QOQ
Data center $18.4 billion 409% 27%
Gaming $2.9 billion 56% Flat
Professional visualization $463 million 105% 11%
Automotive $281 million (4%) 8%
OEM and other $90 million 7% 23%
Total $22.1 billion 265% 22%

Data source: Nvidia. OEM = original equipment manufacturer; OEM and other is not a target-market platform. YOY = year over year. QOQ = quarter over quarter.

The data center segment's revenue -- which notched another quarterly record -- continued to grow as a percentage of the company's total revenue. So, this artificial intelligence (AI)-driven business is increasingly driving overall results. In fiscal Q4, this segment accounted for 83% of total revenue.

The segment's performance is even more impressive given that "sales to China declined significantly in the fourth quarter due to U.S. government licensing requirements," as Colette Kress said in her CFO commentary. China historically accounts for about 20% to 25% of Nvidia's data center's revenue, as I reported when the government's chip exporting restrictions were expanded in October 2023.

Kress attributed the data center's robust growth to "higher shipments of the NVIDIA Hopper GPU computing platform used for the [AI] training and [AI] inference of large language models, recommendation engines, and generative AI applications, along with InfiniBand end-to-end [networking] solutions."

Generative AI is the tech behind OpenAI's ChatGPT chatbot, which exploded in popularity following its full release to the public in late 2022.

What the CEO had to say

Here's much of what CEO Jensen Huang had to say in the earnings release:

Accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries and nations. Our Data Center platform is powered by increasingly diverse drivers -- demand for data processing, [AI] training and [AI] inference from large cloud-service providers and GPU [graphics processing unit]-specialized ones, as well as from enterprise software and consumer internet companies. Vertical industries -- led by auto, financial services and healthcare -- are now at a multibillion-dollar level.

Guidance

For the first quarter of fiscal 2025 (ends in late April), management expects revenue of $24 billion, which equates to growth of 234% year over year. It also guided (albeit indirectly by providing a bunch of inputs) for adjusted EPS of $5.41, or 396% growth.

Going into the report, Wall Street had been modeling for Q1 2025 adjusted EPS of $4.99 on revenue of $22.1 billion, so the company's outlook easily exceeded both estimates.

Another incredible quarter

In short, Nvidia turned in another powerful quarterly report, and its guidance suggests management is incredibly optimistic that the voracious demand for its products and services will continue, thanks in large part to the robust adoption of AI.

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BA McKenna has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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