Nvidia Corp (NVDA) – Get a report shares rose on Friday as tensions in the United States and China pressed global markets, offsetting a solid first-quarter earnings report that included more than $ 1 billion in data center chip sales and improved profit margins.
Nvidia said non-GAAP earnings for the three months ending April 26 were returned at $ 1.80 per share, more than twice last year’s amount and firmly ahead of Street’s 1-consensus forecast. $ 69 per share. The group’s revenue, driven by 80% year-on-year in data center chip sales, rose 38.7% to forecasts, beating $ 3.08 billion.
Demand for data centers, driven by a shift from work at home in the world̵
“The new NVIDIA has a much larger footprint in data center computing, overall performance and full experience in data center architecture and a huge scale to accelerate innovation,” CEO Jensen Huang told investors in a conference call Thursday. “NVIDIA and Mellanox are the perfect combination and position us for the main forces shaping the IT industry today, data center data centers and AI.”
“This is the era of computing large-scale data centers, and together, NVIDIA and Mellanox can architect from end to end,” he added. “Mellanox is an exceptional company and I am excited that we are now a force to invent the future together.”
Shares of Nvidia were 1.1% higher in trading with earkt on Friday at $ 355.00 each, which will leave the shares with a stable annual profit of nearly 50%.
Increased operating costs could be another reason why Nvidia shares are likely to open at or down Friday, with the non-GAAP figure expected to rise 26.7% quarterly to just over $ 1 billion. as the group absorbs Mellanox employees and ramp up investment. The cost of non-GAAP for the full year, Nvidia said, is likely to exceed $ 4 billion.
However, the group still sees current gross margins of 66% based on non-GAAP, which is another record for the company.
“NVIDIA has met high expectations,” said BMO Capital Markets analyst Ambris Srivastava, who has a price tag of $ 425 and an excellent stock rating. “The company’s visibility seems to continue to be strong in this business in the next quarter as well. Gaming and other businesses were more or less than expected.”
“Commenting on what should be GM’s constant strength sets us apart,” he added. “Our forecasts are getting higher as we now report Mellanox, while our GAAP estimates are therefore lower.”