Last year, artificial intelligence crowned two companies in particular. First, OpenAI, the creator of ChatGPT, has been in an unprecedented self-destructive crisis since firing its CEO Sam Altman last Friday. Another, Nvidia, maker of the most powerful microprocessors, is experiencing days full of wine and roses. This Tuesday it marked its all-time high on the stock market, where it is the fifth most valuable American company, and presented quarterly results in which sales and profits soared.
The microprocessor company reported revenue of $18.12 billion (16.6 billion euros) in the third quarter of its fiscal year, which ended October 29, 2023. This value is more than three times the same period last year (plus 206%). 34% more than in the previous quarter, which was by far the record figure for the company.
“Our strong growth reflects the general purpose industry platform’s broad transition to accelerated computing and generative AI,” Nvidia founder and CEO Jensen Huang said in a statement.
Profit reached a quarterly record of 9,243 million dollars, an impressive increase that represents a 13.6-fold increase from 680 million in the same period last year. Earnings per share for the quarter were $3.71, more than 12 times higher than a year ago and 50% higher than the previous quarter.
In the first nine months of the year, the company increased its profit by 85% to $38,819 million and increased its net profit sixfold to $17,475 million. With computing demand surging and no clear competitor in more powerful microprocessors, Nvidia’s margins are impressive.
The impact that artificial intelligence could have on Nvidia became clear the day the company reported its first quarter results and second quarter guidance, surprising everyone. “In the more than 15 years we have been doing this work, we have never seen guidance like the one Nvidia just presented with a second-quarter outlook that appeared to be cosmological and shattered expectations .”, Bernstein analysts wrote in a report sent to clients. This put it in the trillion-dollar market value club, which only includes Apple, Microsoft, Alphabet (Google) and Amazon. This Tuesday it was 1.23 billion.
The company conveys the idea that stores have been around for some time. “Large language modeling startups, consumer internet companies and global cloud service providers were the first to move, and the next waves are starting to form.” National and regional cloud service providers are investing in AI clouds to meet local demand “, Enterprise software companies are adding AI co-pilots and assistants to their platforms, and companies are building tailored AI to automate the world’s largest industries,” Nvidia’s boss said in the statement. “The era of generative AI is gathering pace,” he concludes.
All in all, the results didn’t impress the market, especially since fourth-quarter revenue is forecast to hit $20 billion, meaning growth is slowing compared to the third quarter. For this reason, the price has reacted slightly downwards outside of normal market hours.
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