Nvidia Q4 Results: Strong topline growth backed by growth across Segments

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Nvidia Q4

Earnings beat estimates - The company reported earnings per share (EPS) of $1.32 (adjusted), which is higher than analysts' expectation of $1.22. The EPS was up 69% compared to the year-ago period.

Revenue increase - The chip-maker reported revenue of $7.64 billion, up 53% YoY. It is higher than analysts' expectation of $7.42 billion.

Updates from the various segment :

  • Data Center -  The revenue from the data center grew 71.5% YoY, accelerating from the previous quarter's pace.
  • Gaming - It is the largest market for the company and the gaming business rose 37% year-over-year to $3.42 billion driven by GeForce sales.
  • Chip business - The chip business was up 109% annually to $643 million driven by workstation chip sales and hybrid working.
  • Automotive business -  It was down 14% to $125 million. It’s not a primary focus for the company but represents a growth market for its chips.

Update on Arm Acquisition - Nvidia was in talks to purchase chip technology company Arm from SoftBank. The acquisition was first announced in September 2020. However, due to significant regulatory challenges, both Nvidia and SoftBank agreed to terminate the transaction.

2022 Outlook - Nvidia expects to generate approximately $8.1 billion in revenue in Q1FY23, representing YoY growth of approximately 42%. It is higher than analysts' expectations of $7.2 billion.

Target Price - The 38 analysts offering 12-month price forecasts for NVIDIA Corp have a median target of $350, with a high estimate of $400 and a low estimate of $200.

Nvidia's share price closed flat on Wednesday at $265.11 per share.

Nvidia Q4 Results Review:

Nvidia has topped the estimate both in its topline and bottom-line. All the segments have grown YoY except the Automotive segment. The 2022 outlook is also growth and above analysts' expectation. The company will continue to dominate the AI server space thanks to its hardware and software prowess. It has also announced a new multi-year partnership with Jaguar Land Rover.