Sign up UNITED KINGDOM
Proactive Investors - Run By Investors For Investors

Nvidia shares surge premarket after fourth quarter numbers surprise the market

CEO Jensen Huang believes the really big revenue from automotive will start in 2019-2020, when auto makers, startups, taxi companies, ride-hailing companies and others start to order self-driving capabilities in their vehicles
Nvidia shares surge premarket after fourth quarter numbers surprise the market
The improved results were due to greater demand for its core product – graphics chips.

Nvidia Corp. (NASDAQ:NVDA) saw its shares surge in premarket deals after analysts upgraded their stance on the stock following its impressive full year and fourth quarter numbers.

The improved results were due to greater demand for its core product – graphics chips. 

READ: Nvidia unveils AI partnership with Uber at CES 2018

The chip maker reported fourth-quarter net income of US$1.12bn, or US$1.78 a share, compared with US$655mln, or 99 US cents a share, a year ago.

Adjusted earnings stood at US$1.72 a share, coming in above market expectations for US$1.16 a share.

During the quarter, revenue rose to US$2.91bn from US$2.17bn from last year, against Wall Street’s consensus of US$2.68bn.

Gaming revenue rose 29% to US$1.74bn against market expectations for a 14% growth to US$1.54bn, year on year.

Data-center revenue surged by 105% to US$606mln, soundly beating market expectations for an 85% growth to US$548.1mln.

READ: Nvidia dips as Elon Musk hints Tesla could drop chipmaker’s technology from its electric cars

The only laggard was in the automotive business which saw a growth of less than 15% for the full year.

Chief Financial Officer Colette Kress said on Thursday: “The sequential decline reflects our transition from infotainment, which is becoming commoditized, to next-generation AI cockpit systems and complete top-to-bottom self-driving-vehicle platforms built on Nvidia hardware and software,” Kress said.

The Xavier processor, a chip with 9 billion transistors that Nvidia calls the most complex system-on-a-chip ever created, is expected to eventually drive its automotive business.

Nvidia Chief Executive Jensen Huang added that he believes the really big revenue from automotive will begin in about 2019 to 2020, when auto makers, startups, taxi companies, ride-hailing companies and others begin to order self-driving capabilities in their vehicles and fleets.

READ: Nvidia heads higher as it strikes supply deals with several Chinese computing giants

Huang said the brains for self-driving cars will sell for an average of about US$500 to US$1,000, while those for autonomous ride-hailing vehicles, will command several thousand dollars each.

In premarket trade, its shares were up 9.65% at US$238.50.

View full NVDA profile View Profile

Nvidia Timeline

Newswire
November 06 2015

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investor UK Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use