Nvidia Q1 Results: Will strong revenue forecast push Nvidia share prices higher?

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Nvidia Q1 Results

Nvidia Q1 results: Key insights

  1. Nvidia projected higher revenue expectations for the June quarter of 2023 at $11 billion, much higher than analyst expectations. 
  2. Nvidia expects revenue to soar in the upcoming quarters this year as demand for its chips that power artificial intelligence (AI) services like chatbots have skyrocketed.
  3. According to analysts, Nvidia dominates roughly 80% of the market for graphics processing units, or GPUs, used to speed up AI work.
  4. Highest revenue gains came from Nvidia’s data center business, a key service provider in the AI business. 
  5. However, revenues and profits for the recent quarter slipped amid a rise in operating expenses. 

Nvidia share price and Nvidia results:

Nvidia shares soared 27% in pre-market trading on May 25, 2023. Nvidia shares have jumped about 80% over the past one year over a set of strong earnings and general growth witnessed in technology shares amid an AI boom.

The company which is the market leader in gaming GPUs is also growing exponentially in the AI space with the introduction of chatbots like ChatGPT which require high powered chips for smooth functioning. 

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(Data as on May 24, 2023)

Decoding Nvidia Q1 earnings:

Nvidia Revenue

  • Nvidia reported revenue for the first quarter of FY24 of $7.2 billion, down 13% from a year ago and up 19% from the previous quarter.
  • While the company's data center and AI chip business seems to be firing up, its legacy gaming business has witnessed a steep slowdown over the past few quarters. 
  • Gaming revenues slipped to $2.2 billion from $3.6 billion in the same quarter last year. 

Nvidia Q1 Revenue Breakdown 

Nvidia Revenue Forecast for Q2FY24:

Strong demand for AI development tools has pushed Nvidia to raise its revenue outlook for the upcoming quarters. 

  • For the quarter ending June, the company expects its revenue to jump over 60% compared to the same quarter last year at $11 billion. Nvidia and other chipmaking firms have released several bullish statements on future revenues ever since AI led chatbots and AI led services like ChatGPT became more mainstream. 

Nvidia Q1 Net Profit

  • Nvidia reported a net profit of $2.4 billion for the fourth quarter ended March 2023, compared with a profit of $3.4 billion a year earlier. 
  • Profits have also declined for the second consecutive quarter on account of lower gaming revenues and a rise in operational expenses

Nvidia dividend

NVIDIA is expected to pay its next quarterly cash dividend of $0.04 per share on June 30, 2023, to all shareholders of record on June 8, 2023.

Nvidia Earnings: Brokerage Action

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