Nvidia has once again smashed forecasts with third-quarter revenue of $18.12 billion, marking a historic high for the company.
This achievement propels Nvidia’s market cap to a staggering $1.22 trillion. We were only ranting on about it hitting $1 trillion a few months ago.
The record-breaking revenue represents a significant increase, with a 34% rise over the previous quarter and a remarkable 206% growth over Q3 2022. This performance comes on the heels of Nvidia’s stock reaching an all-time high of $499.60 per share.
The company’s financial success is also reflected in its data center revenue, which stood at $14.51 billion.
Additionally, Nvidia saw a surge in gaming revenue, reaching $2.86 billion, and gains from its Professional Visualization and Automotive business units. Its adjusted gross margin expanded to 75%, and the company generated $7.04 billion in free cash flow.
Nvidia’s founder and CEO, Jensen Huang, attributed this remarkable growth to generative AI.
Huang stated, “Our strong growth reflects the broad industry platform transition from general-purpose to accelerated computing and generative AI of NVIDIA.”
He further acknowledged the role of AI startups, consumer internet companies, and cloud service providers in fueling growth.
Impact of US export restrictions
Will Nvidia continue its incredible upward trajectory? The US government recently doubled down on export bans, to which Nvidia responded by – you guessed it – releasing more AI chips that evade the ban.
China contributes some 20 to 25% of Nvidia’s data center revenue, and its CFO, Colette Kress, indicated that this ban would lead to a significant decline in income from China in the fourth quarter.
Despite this, Kress remains optimistic, stating that they expect strong growth in other regions to offset China’s decline. They’ve not been wrong about this thus far.
Looking ahead, Nvidia anticipates challenges due to export controls but remains confident in its ability to adapt and thrive. The company predicts around $20 billion in revenue for the fourth quarter, a modest increase of almost $2 billion.
The company also has new high-end chips in the pipeline, including the H200, the successor to its leading H100.
These record-breaking figures show that, despite regulatory challenges, the AI industry is simply too hungry for GPUs for Nvidia to even remotely slow down in its tremendous 2023.
