Nvidia's data center GPUs and networking chips are driving revenue growth, with strong investment outlook.

From Nasdaq: 2024-09-20 17:00:00

Nvidia’s data center GPUs have become a major revenue driver, generating $22.6 billion in revenue last quarter, accounting for 75% of overall revenue. In addition to GPUs, Nvidia’s networking chips are also seeing impressive growth, with $3.7 billion in sales and an annual revenue run rate of $14 billion.

The global data center networking market is estimated to hit $37.6 billion in revenue this year. Nvidia’s Spectrum-X Ethernet networking platform is gaining traction, with CFO Colette Kress claiming it could become a multibillion-dollar product line within a year. Nvidia is well-positioned to capture a significant share of the growing AI chip market.

Analysts predict Nvidia’s earnings to grow over 52% annually for the next five years. With the company trading at 42 times forward earnings, a discount compared to the U.S. technology sector’s average, it is seen as a strong investment opportunity. The future looks bright for Nvidia’s data center business, with potential for significant growth in the long run.



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