**Nvidia Exceeds Expectations with Stellar Q1 Results and Raises Forecast**
Artificial intelligence technology leader Nvidia (NVDA) surpassed Wall Street's targets for its fiscal first quarter, issuing a stronger-than-expected outlook for the current period and announcing a 10-for-1 stock split. Following the announcement, Nvidia stock saw a rise in extended trading.
The Santa Clara, Calif.-based chipmaker reported adjusted earnings of $6.12 per share on sales of $26 billion for the quarter ending April 28. Analysts surveyed by FactSet had anticipated earnings of $5.60 per share on sales of $24.59 billion. Compared to the same period last year, Nvidia's earnings soared by 461%, while sales surged by 262%.
This marks the fourth consecutive quarter in which Nvidia has achieved triple-digit percentage growth in both sales and earnings.
Looking ahead, Nvidia expects to generate sales of $28 billion for the current quarter, significantly higher than the consensus estimate of $26.62 billion. In the same quarter last year, Nvidia reported sales of $13.51 billion.
In after-hours trading today, Nvidia stock surged 5.9% to $1,005.89, reaching a record high. Earlier, during the regular session on Wednesday, Nvidia stock had dipped 0.5% to close at $949.50, remaining within the buy range.
"The next industrial revolution has begun. Companies and countries are partnering with Nvidia to transform trillion-dollar traditional data centers into accelerated computing hubs and build a new type of data center—AI factories—to produce a new commodity: artificial intelligence," said Chief Executive Jensen Huang in a news release.
He continued, "AI will bring significant productivity gains to nearly every industry, helping companies become more cost- and energy-efficient while expanding revenue opportunities."
In the first quarter, Nvidia's data center sales skyrocketed 427% year over year to $22.6 billion, as enterprises rapidly adopted graphics processors for AI applications. Data center sales also increased 23% from the fourth quarter.
Nvidia announced that its 10-for-1 stock split will take effect on June 7.
Additionally, the company has increased its quarterly cash dividend by 150%, raising it to a penny per share on a post-split basis. This means that on a pre-split basis, the dividend has risen from 4 cents per share to 10 cents.
During a conference call with analysts, Chief Financial Officer Colette Kress highlighted that large cloud computing service providers were the primary drivers of Nvidia's data center business last quarter, accounting for about 45% of the company's data center revenue.
Beyond cloud service providers, Nvidia's products are also being adopted for generative AI by consumer internet companies, sovereign nations, automotive firms, and healthcare organizations.
Kress noted that the demand for Nvidia's graphics processing units (GPUs) is expected to exceed supply well into next year.
Nvidia Stock: 'Next Wave Of Growth' Aheadnull
Strong demand for Nvidia's Hopper series processors for generative AI training and inference drove the company's data center growth in the first quarter, according to CEO Jensen Huang.
"We are poised for our next wave of growth," Huang stated. "The Blackwell platform is now in full production and serves as the foundation for trillion-parameter-scale generative AI. Spectrum-X introduces a new market, enabling us to bring large-scale AI to Ethernet-only data centers. Additionally, Nvidia NIM is our new software offering that delivers enterprise-grade, optimized generative AI across various platforms — from the cloud to on-prem data centers and RTX AI PCs — through our extensive network of ecosystem partners."
Nvidia has accelerated its timeline for generating revenue from the Blackwell series. The company anticipates production shipments of Blackwell products within the current quarter, with a significant ramp-up in the third quarter, according to CEO Jensen Huang. Data centers utilizing Blackwell processors are expected to be operational by the fourth quarter.
"We will see a lot of Blackwell revenue this year," Huang stated during the conference call.
Investor concerns leading up to Nvidia's report included the impact of U.S. trade restrictions with China and the company's ability to secure enough components from its contract manufacturers to meet demand.
Analysts were also worried about a potential dip in sales of the current Hopper series graphics processing units once the Blackwell series GPUs become available later this year.
Major cloud service providers have been investing heavily in Nvidia GPUs to enhance their capacity for generative artificial intelligence applications.
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