Nvidia earnings, revenue expected to surge first quarter as AI trade faces latest test
Will Nvidia's AI Chip Surge Face a New Rival Threat?
Nvidia is poised to announce its Q1 earnings, with expectations of significant increases in revenue and profits, driven by heightened demand for its AI chips. Analysts predict a more than 200% revenue increase to $24.69 billion and a 400% rise in profits. The data center business is expected to be a major contributor, with anticipated revenue of $21 billion.
Despite the positive outlook, there are concerns about the transition from Nvidia's Hopper to Blackwell AI chips, potentially causing customers to delay orders. Additionally, competition is intensifying as companies like Amazon, Google, and Microsoft develop in-house AI chips, which could impact Nvidia's market share.
What is the projected revenue for Nvidia's Data Center business in the first quarter, and how does it compare to last year's figures?
The projected revenue for Nvidia's Data Center business in the first quarter is $21 billion. This is a significant increase from the same quarter last year, when the Data Center business brought in $4.28 billion in revenue. The substantial growth in revenue is attributed to the surge in demand for Nvidia's chips amid the AI boom.
How has Nvidia's stock performance changed over the last year and since the stock market lows in October 2022?
Nvidia's stock performance has been remarkable over the last year and since the stock market lows in October 2022. Over the last 12 months, Nvidia's stock has risen by approximately 223.11%, significantly outperforming the S&P 500, which gained around 30.13% during the same period. This surge can be attributed to the increased demand for Nvidia's specialized data center chips, which are designed for processing AI workloads4.
Since the stock market lows in October 2022, Nvidia's stock has experienced an impressive increase of nearly 700%. This growth has been driven by the rising demand for AI technology, with Nvidia's H100 graphics processing unit (GPU) becoming the hottest piece of AI hardware last year4. The company's data center revenue reached $47.5 billion during its fiscal 2024 year, a 217% increase from fiscal 2023, and accounted for 78% of Nvidia's total revenue4.
Nvidia's strong performance is expected to continue, as the company is set to ramp up shipments of its new H200 GPU this year. This new chip can inference (ingest live data so AI models can make predictions) twice as fast as the H100, while consuming half the amount of energy. As a result, demand could be off the charts for the new chip, and Nvidia's stock might continue to trend higher.