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Nvidia (NASDAQ:NVDA) actions increased by 8% during post-market trading on Wednesday, as the company once again topped expectations for fiscal 2024 fourth-quarter financial results.
During the post-market earnings call, executives detailed an exhaustive list of companies and industries embracing Nvidia’s generative AI, providing an endless deluge of the question.
“Generative AI is a new application,” said Jensen Huang, founder and CEO of Nvidia. “It’s enabling a new way of building software. It’s a new way of processing computers. This is enabling a whole new industry. This is driving our growth.”
“We are diversifying into new sectors,” he added. “Automotive, healthcare, robotics, financial services…a collection of multi-billion dollar industries are embracing our generative AI.”
Anticipate the evolution of AI generation factories in every industry.
“The world has reached an inflection point,” said Colette Kress, Nvidia’s chief financial officer. “Fourth quarter data center revenue was driven by generative AI and training. We estimate that approximately 40% of data center revenue for the latest year came from AI.”
He pointed to the recent success of Microsoft’s (MSFT) Copilot, which uses Nvidia’s generative artificial intelligence. Additionally, Meta (META), in its latest quarter, referenced generative artificial intelligence as a primary driver of its growth.
“One of the most notable trends of the last year is the adoption of artificial intelligence by industries,” Kress said. “Nearly 80 vehicle manufacturers use Nvidia’s AI framework for autonomous driving and other applications. We expect this trend to grow.”
“Pharmaceutical companies are embracing Nvidia’s generative AI for computer-assisted drug discovery,” he added. “In financial services, companies are using AI for fraud detection, customer service and trading.”
Sovereign AI has become another area of demand for markets outside of the United States and China.
“Growth has been strong everywhere except in China,” Kress said.
The percentage of data center revenue coming from China was in the single digits during the fourth quarter, Kress said. Nvidia expects the situation to remain unchanged for the current quarter.
Looking forward
In new products, Nvidia’s Spectrum-X networking platform is the first Ethernet platform that improves the performance of generative AI over Ethernet.
“We are on track to ship Spectrum-X this quarter,” Kress said.
Looking to the first quarter of fiscal 2025, Nvidia expects to generate revenue of $24 billion, give or take 2%. Analysts expected revenue of $22 billion.
“We guide one quarter at a time, but fundamentally the conditions for growth are excellent,” Huang said. “We are in the transition phase from general purpose computing to accelerated computing.”
For the fourth quarter ended January 28, 2024, Nvidia earned an adjusted $5.16 per share on revenue of $22.1 billion. Analysts had expected the company to post earnings of $4.64 per share on revenue of $20.5 billion for the quarter.