Nvidia reported revenues of $22 billion in the fourth quarter, up nearly 270% from the prior year and even above Wall Street’s soaring expectations.
The tech giant’s stock got a big boost from the news, rising nearly 9% to $732 per share in after-hours trading.
Nvidia’s H100 GPUs, the $30,000 chips that power generative AI products, have unleashed a buying frenzy from the biggest of big tech companies. Its largest purchasers are Microsoft and Meta — which spent $4.5 billion each on the chips last year — followed by Google parent Alphabet, Amazon, and Oracle.
Even as those customers moved to develop their own AI chips and partner with its rivals, Nvidia’s revenues from generative AI show no signs of slowing. Fourth quarter revenues from data centers that use its GPUs for AI exceeded $18 billion, up more than 409% from the prior year.
“Accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries and nations,” said Nvidia CEO Jensen Huang in a statement Wednesday (Feb. 21).
Nvidia stock dropped in Wednesday trading as low as $662, following its loss of $78 billion in market value the day before. Now it’s recovering.
The company’s shares are about 40% higher than it was at the beginning of January, and about 200% higher than a year ago. At one point last week, the company was the third-most valuable in the U.S., ahead of Amazon and Alphabet.
But it’s unclear if that glory is sustainable. “Another blockbuster quarter from Nvidia raises the question of how long its soaring performance will last,” Jacob Bourne, a senior analyst for Insider Intelligence, wrote in a note. “Nvidia’s near-term market strength is durable, though not invincible.”
Small changes in Nvidia’s share price go a long way. Nvidia has fewer shares priced higher than other tech giants like Apple and Alphabet, and any minor wins and losses on stock market impact its market cap more than those companies.