New York, NY – The past year proved to be a significant year for artificial intelligence, and one company that reaped the benefits of this trend was chipmaker Nvidia. According to the latest earnings report, Nvidia’s profits soared to nearly $12.3 billion in the three months ending January 28th, a staggering 769% increase from the previous year. This growth exceeded the expectations of Wall Street analysts and contributed to a full-year profit increase of over 580% from the year before.
The company also experienced a 265% year-over-year increase in fourth quarter revenue, surpassing analyst projections. Nvidia’s CEO, Jensen Huang, emphasized the widespread surge in demand for AI technology across various companies, industries, and nations, likening it to the onset of a new industrial revolution. Nvidia’s dominance in producing processors that power AI systems, coupled with its strong partnerships with major infrastructure companies like Google, Amazon, and Cisco, contributed to its fourth quarter data center business sales growing by 409% year-over-year to a record $18.4 billion.
Despite its impressive performance, concerns have arisen regarding the longevity of such staggering growth. US restrictions introduced last year on exports of advanced AI chips to China posed a threat to Nvidia’s access to a substantial and rapidly growing market. However, the company has already initiated the shipment of alternative chips to China in compliance with the restrictions.
Analysts have expressed optimism about Nvidia’s future, viewing the company as having significant potential for further growth, considering the surge in demand for its chips and the potential delay in AI chip competition from other major players in the industry. Nvidia’s CFO, Colette Kress, noted that the demand for its advanced AI chips continues to outstrip supply, with AI solutions now permeating virtually every industry. However, ensuring that supply meets the increasing demand poses a potential challenge for the company in the coming year. Nonetheless, Nvidia remains confident about its projection of a 233% increase in revenue for the current quarter, surpassing Wall Street’s expectations.