Nvidia's Q1 revenue beats expectations with strong data centre revenue growth, stock split planned.

From Morningstar: 2024-05-23 06:57:00

Nvidia reported Q1 revenue of $26.0 billion, up 18% sequentially and 262% year over year, surpassing guidance of $24.0 billion. Data centre revenue reached $22.6 billion, up 23% sequentially and 427% year on year, highlighting strong demand from cloud computing leaders, enterprises, and consumer internet giants.

For Q2, Nvidia anticipates revenue to reach $28.0 billion, up 8% sequentially and 107% year on year, exceeding FactSet consensus estimates. The company expects continued growth in data centre revenue, with 3 consecutive quarters of at least $3 billion in incremental revenue driven by AI demand.

In June, Nvidia will initiate a 10-for-1 stock split with a new adjusted gross margin expected at 75.5% for the July quarter despite higher costs associated with Blackwell product rollout. The company raised its dividend by 150% but retains a relatively low $0.40 per share annually, reflecting confidence in future growth.

Analysts raise Nvidia’s fair value estimate to $1,050 from $910 given the company’s exceptional data centre revenue growth projections. With management confident in demand for both current and upcoming products, Nvidia is well-positioned to capitalize on the increasing focus on AI technologies in various sectors.



Read more at Morningstar: Nvidia Earnings: AI Demand Smashes Forecasts Again