Nvidia expects revenue to boom as AI drives chip demand

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The surge in demand for chips needed to train the latest wave of generative AI systems like ChatGPT led Nvidia to release a revenue forecast that was far ahead of Wall Street’s expectations, causing its stock price to surge in the aftermarket.

The U.S. chipmaker said on Wednesday it expects sales to hit $11 billion in the three months to the end of July, well ahead of the $7.2 billion analysts had expected and confirming its position as the biggest beneficiary. short term of the race for AI that has erupted in the technology sector.

The forecast fueled a 20% jump. Nvidiawhich had already more than doubled since the beginning of the year, and have brought its stock market value to 900 billion dollars.

The bullish forecast came as Nvidia reported that revenue and earnings in its latest quarter through the end of April also beat forecasts, thanks to increased sales to data center customers as demand for AI takes off .

Jensen Huang, the chief executive, said the jump in sales reflected “two simultaneous transitions: accelerated computing and generative AI.” He added that the company is “significantly increasing our offerings to meet growing demand” for the entire family of data center chips, including the H100, a new product launched this year designed to handle the demands of so-called large language models such as OpenAI’s GPT-4.

In the recent quarter, revenue reached $7.19 billion, up 19% from the prior three months but down 13% from a year earlier, due to declining system chip sales. game.

Earnings per share increased 22% from a year earlier to 82 cents, or $1.09 on a pro forma basis. Wall Street judges the company. Consensus opinion on Wall Street had been for revenue of $6.52 billion and pro forma earnings of 92 cents a share.