Nvidia sale surges 57% thanks to Mellanox acquisition

Nvidia reported 57 percent increase in revenue at $4.73 billion in the third quarter ending in October 2020.
Nvidia at trade show
Nvidia’s sale was driven by its compute and networking segment, which was up 146 percent from a year ago to $1.94 billion. Sale was also boosted by the company’s graphics segment, which was up 25 percent from last year to $2.79 billion.

Nvidia said on Wednesday that its purchase of Mellanox, which closed earlier this year, contributed 13 percent to total company revenue and about a third of data center revenue.

Nvidia CEO Jensen Huang said in August that the company is expecting a strong half of the year in its gaming division.

During the quarter, Nvidia revealed its new graphics cards based on a new technology it calls Ampere, and interest was strong. One of the new models, the GeForce RTX 3080, went on sale in September and immediately sold out.

Revenue in the gaming market was up 37 percent to $2.27 billion — driven by sale of graphics cards to computer and console makers, and said that desktop sales benefitted from the launch of its new RTX graphics cards.

On Wednesday, the company said that both its gaming and data center divisions have also been boosted during the Covid-19 pandemic as customers need computers to work and play from home.

Last quarter, Nvidia’s data center line item surpassed gaming revenue for the first time. This quarter, Nvidia reported $1.9 billion in sales in the data center market, behind the gaming division, though it increased by 162 percent from the same period last year, driven by sales of Ampere graphics chips.

Nvidia said in a call with analysts that it expected its data center revenue to decline in the current quarter, partially driven by a Chinese customer not purchasing Mellanox networking products.

In September, Nvidia said it planned to buy ARM from SoftBank for $40 billion. Nvidia said on Wednesday that it expected to close the ARM acquisition in the first quarter of 2022.

Nvidia said that it expected $4.8 billion in revenue in its fiscal fourth quarter.

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