Nvidia rides AI and deep learning to strong first-quarter financials

Nvidia's first-quarter financial results are in, and they'll probably continue to make other tech companies green with envy. The GPU maker raked in $1.94 billion in revenue for its fiscal 2018 first quarter, up 48% from a year ago. It also enjoyed operating profit of $554 million, up 126% from a year ago. Gross margin increased 1.9% from a year ago to 59.4%.

Surprising nobody, Nvidia says growth in demand for its GPUs across all of its businesses drove these results. On the way to $1.56 billion in GPU revenue, the company highlighted especially strong demand for its gaming and data center products. Businesses snapped up $409 million of the company's GPU compute accelerators and related services, a claimed 186% year-on-year increase.

The $43 million in revenue Nvidia got from its patent-licensing agreement with Intel this quarter marks the final such payment from that arrangement. Nvidia ended the quarter with $6.21 billion in cash on hand, down from $6.8 billion in the last quarter. The company says the decrease "was primarily related to principal payments for early exercises of our convertible notes."

For the second quarter of its fiscal 2018, Nvidia expects revenue of $1.95 billion, plus or minus two percent. If that guidance holds, it would reflect a 50% year-on-year increase. Gross margin for the next quarter is projected at 58.4%, up 0.8% from a year ago.

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    • ptsant
    • 3 years ago

    Raja should produce similar results or get out.

      • bjm
      • 3 years ago

      I highly doubt he’ll be producing similar results anytime soon. Nvidia’s all-around product execution has been on-point for the last several generations and they are showing no signs of slowing down. That’s no knock on Raja, but more of a testament to Nvidia–they aren’t messing around.

    • Ninjitsu
    • 3 years ago

    [quote<] "was primarily related to principal payments for early exercises of our convertible notes."[/quote<] u wot m8?

      • K-L-Waster
      • 3 years ago

      People were holding convertible notes and as the stock value rose they exercised their right to convert them into shares.

        • Bumper
        • 3 years ago

        I think the bonds were expiring and nvidia paid out the principal. Otherwise cash on hand wouldnt have changed. Converting bonds just changes a liability into a stockholders equity via shares issued.

    • Star Brood
    • 3 years ago

    When you can charge whatever you want, of course you’re going to bathe in profits. AMD is still hemorrhaging money because they have to set their prices so low.

    The sub-$200 GPU market is not profitable unless you would price your product so low anyway. AMD has nothing to compete and their product stack was literally a refresh.

    AMD Vegan is still vaporware (read: no meat) while NVidia have had the high-end cornered since the first Titan. Additionally, they will have to price it crazy low which will further drop profits.

    AMD moves a lot of volume in game consoles, but those also sell at break-even at best. Again, no profit.

    Selling Intel-Extreme-class CPU’s at less than half price is earth-shattering, though Intel have been charging those prices for years. AMD missed out on a whole lot of gains by only showing up now.

    AMD is great for consumers to keep prices in check and to keep innovating. However, they’re basically a charity for doing so.

    AMD’s best hope is they corner all aspects of the market and force NVidia and Intel to lower their own prices, thereby somewhat leveling the playing field in gains. This would also be great for consumers.

      • ronch
      • 3 years ago

      While it’s good for us consumers for AMD to price their stuff so affordably, it’s also kinda sad to see that despite AMD having a new kickass CPU lineup they’re still losing money. Things may change next quarter or so but I’ll believe it when I see it.

      • DoomGuy64
      • 3 years ago

      AMD’s GPUs are compute monsters. They just don’t have the software and ecosystem to back it up, and Fiji was ram limited. The polaris pro duo is better balanced for professional work, but I don’t know if AMD has server hardware like Nvidia does. That’s where the real money is, and Nvidia has a lock with CUDA. AMD has to break that lock before even bothering to try entering that market. They’re slowly moving in that direction though. Oh well. I’m happy with getting cheap cards and freesync. It’s not like AMD getting into deep learning is going to change anything for consumers.

        • strangerguy
        • 3 years ago

        Who cares how much effort AMD puts into compute when the end result is nowhere near NV?

        It’s not like AMD is giving us free GPUs to start with or they are some poor kid making a living out in a suburb garage building a GPU.

          • DoomGuy64
          • 3 years ago

          Did you even read my post? Guess not. You basically summarized what I already said.

          The only people who do care about this stuff are scientists and investors. It doesn’t affect gamers how AMD runs it’s compute business.

    • chuckula
    • 3 years ago

    The scarier rumors are that Volta is actually launching this year for at least some product segments (probably high-end compute first).

    That’s a pretty aggressive launch cadence and it isn’t giving the competition a whole lot of breathing room.

      • Bumper
      • 3 years ago

      aren’t they launching volta tesla tomorrow?

        • chuckula
        • 3 years ago

        We’ll find out then.

          • frenchy2k1
          • 3 years ago

          Tesla V100 just announced in GTC.
          So, Volta was just announced.

      • jihadjoe
      • 3 years ago

      I think since Kepler Nvidia has always been HPC first, in a supercomputer if someone’s building at the time of launch, then with Teslas, and finally the consumer parts. Only makes sense to launch in the highest profit segments before trickling down to less lucrative markets.

        • psuedonymous
        • 3 years ago

        Maxwell went low-end first. Even if you don’t count GM1xx as ‘real’ Maxwell, GM204 launched before GM200.

    • tsk
    • 3 years ago

    Oof, it’s gonna be hard for AMD to keep up with Nvidia going forward.

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