Technology giant Nvidia has announced a record-breaking surge in sales, more than doubling its revenue due to skyrocketing demand for its artificial intelligence (AI) chips. The company reported revenue exceeding $13.5 billion (£10.6 billion) for the three months ending in June.
Nvidia anticipates continued sales growth in the current quarter and has revealed plans to repurchase $25 billion worth of its own stock. Following this announcement, the firm’s shares experienced a more than 6.5% increase in after-hours trading in New York, further building on its substantial gains throughout the year.
The technology giant is also forecasting revenue of approximately $16 billion for the three months ending in September. This projection significantly surpasses Wall Street’s expectations and indicates a staggering rise of around 170% compared to the same period the previous year.
Jensen Huang, Nvidia’s chief executive, conveyed his excitement about a “new computing era” in a statement. He highlighted the global shift from general-purpose computing to accelerated computing and generative AI applications.
The driving force behind Nvidia’s exceptional performance is its data centre business, which includes AI chips. This segment recorded revenue of over $10.3 billion, marking an increase of more than 170% compared to the previous year. Cloud computing service providers and large consumer internet companies are eagerly adopting Nvidia’s next-generation processors.
Nvidia’s market value has soared past $1 trillion this year, with its shares experiencing more than a tripling in value. This achievement has propelled Nvidia into the ranks of the “Trillion dollar club,” joining other publicly traded US giants such as Apple, Microsoft, Alphabet, and Amazon.
Sarah Kunst, the managing director of Cleo Capital, a startup investment firm, shared her fascination with Nvidia’s recent success. She noted that while the company has been manufacturing chips for a long time, the market has only recently recognized their immense potential, particularly in AI.
Originally renowned for producing computer chips dedicated to graphics, especially for gaming, Nvidia’s hardware has now become foundational to most AI applications. A report revealed that Nvidia has captured 95% of the machine learning market.
The transformative impact of AI products on computer usage and our daily lives is poised to be significant. Nvidia’s graphics processing units played a critical role in training models like ChatGPT, which provides human-like responses to user queries and is a result of collaboration with Microsoft’s supercomputer.
