Nvidia revenue surges 39% lifted by data center business

Nvidia said revenue rose 39 percent to $3.08 billion in the first quarter ended April 26, with the data center business recording its first $1 billion quarter. Nvidia’s data center business hit $1.14 billion, up 80 percent from a year earlier.
Nvidia at trade show
Nvidia’s net income rose to $917 million, or $1.47 per share, from $394 million, or 64 cents per share, a year earlier.

Nvidia on Thursday forecast second-quarter revenue above analysts’ estimates, as demand surges for its chips used in the data centers that power the shift to working remotely because of the new coronavirus outbreak.

The company said the forecast includes a contribution from its $6.9 billion purchase of Israeli chip firm Mellanox Technologies, which strengthened its data center business.

The chipmaker said it expects current quarter revenue of $3.65 billion, plus or minus 2 percent.

Much like rivals Intel and Advanced Micro Devices, Nvidia recorded a jump in demand for data center chips as companies invested to strengthen their IT infrastructure to support employees working remotely. Nvidia also said that sales to cloud computing companies drove its data center results.

Nvidia’s data center chips power functions such as search suggestions, product recommendations and artificial intelligence work such as speech and image recognition.

Some of Nvidia’s market segments were hurt by the pandemic. The company expects sales to automotive customers to fall 40 percent next quarter. But Nvidia CEO Jensen Huang said in an interview that some of those companies were also investing in robotics for the future, with Nvidia supplying the chips.