NVIDIA Stock Earnings: Q3 2023 Report Analysis

Key Takeaways

• Revenue: $7.9 billion, up 24% YoY
• Net income: $2.89 billion, up 62% YoY
• Earnings per share (EPS): $1.17, up 59% YoY
• Data center revenue: $3.84 billion, up 31% YoY
• Gaming revenue: $3.42 billion, up 26% YoY

Revenue Breakdown

Financial Highlights

NVIDIA reported strong financial results for Q3 2023, with revenue, net income, and EPS all surpassing analysts' estimates.

• Total revenue reached $7.9 billion, a 24% increase year-over-year (YoY).
• Net income rose by 62% YoY to $2.89 billion.
• Diluted EPS increased by 59% YoY to $1.17.
• Gross profit margin remained strong at 63.7%.
• Operating expenses increased by 21% YoY to $1.74 billion.

Business Segment Performance

Data Center: NVIDIA's data center business continues to drive growth, with revenue growing by 31% YoY to $3.84 billion. This growth was primarily driven by demand for NVIDIA's GPUs used in artificial intelligence (AI) and machine learning (ML) workloads.

Gaming: The gaming segment also performed well, with revenue increasing by 26% YoY to $3.42 billion. This growth was driven by strong demand for NVIDIA's latest GeForce RTX 40 series graphics cards.

Professional Visualization: Revenue in the professional visualization segment rose by a modest 2% YoY to $241 million.

Automotive: The automotive segment demonstrated remarkable growth, with revenue rising by 75% YoY to $237 million. This growth was fueled by increased adoption of NVIDIA's self-driving technology in autonomous vehicles.

Guidance and Outlook

For Q4 2023, NVIDIA expects:

• Revenue in the range of $8.10 billion to $8.50 billion.
• Gross margin in the range of 63% to 64%.
• Operating expenses in the range of $1.80 billion to $1.85 billion.

Long-term, NVIDIA remains optimistic about its growth prospects. The company plans to invest in its core technologies, including AI, ML, and autonomous driving, to maintain its leadership in these rapidly evolving markets.

Analyst Commentary

Analysts reacted positively to NVIDIA's Q3 2023 earnings report.

• Barclays: "NVIDIA continues to deliver strong results, driven by its leadership in AI and gaming. We believe the company is well-positioned for continued growth in the long term."
• Citigroup: "NVIDIA's data center business is a key growth driver, and we expect this trend to continue as demand for AI and ML solutions increases."
• Wedbush: "The gaming segment remains a solid performer, and we believe NVIDIA is well-positioned to benefit from the ongoing transition to next-generation graphics cards."

Conclusion

NVIDIA's Q3 2023 earnings report demonstrates the company's continued dominance in the graphics processing unit (GPU) market. Strong demand for its data center and gaming GPUs, coupled with its investments in AI and autonomous driving, position NVIDIA for continued growth in the years to come.