NVIDIA's Quarterly Revenue Surges 106%, Setting a Revenue Record for the 13th Straight Quarter

[Financial News] NVIDIA Corporation, the U.S. chipmaker that leads the global market for semiconductors used in artificial intelligence, posted revenue more than twice as high as a year earlier despite recent concerns over excessive AI investment. Jensen Huang, the company's CEO, said AI has reached an inflection point.
According to CNBC and other U.S. media outlets, NVIDIA said in its earnings release on the 26th local time that revenue for the second quarter of its fiscal year, from May to July, rose 106% from a year earlier to $96.22 billion, or about 133.2 trillion won. That figure topped the $92.17 billion forecast compiled by the London Stock Exchange Group (LSEG) by more than $4 billion. As a result, NVIDIA set a new revenue record for the 13th consecutive quarter.
By segment, revenue from the data center division, which includes AI chips, rose 117% from a year earlier and 18% from the previous quarter to $89 billion. That accounted for 92% of total revenue. Revenue from hyperscalers, the operators of large-scale data centers, more than doubled from $24.2 billion last year to $48.7 billion. Revenue from cloud companies and enterprises, excluding hyperscalers, also climbed from $16.9 billion to $40.3 billion, or about 2.4 times.
Revenue from the edge computing segment, which covers PCs, game consoles and automotive semiconductors, grew 27% from a year earlier to $7.2 billion. Earnings per share came in at $2.22, beating Wall Street's estimate of $2.10. Gross margin was 75%, while operating margin reached 66.5%.
Huang emphasized in remarks on the results that "AI has reached an inflection point." Referring to tokens, the data units used in AI model training and inference, he said, "Tokens are productive and highly profitable, and computation is now revenue." Huang added, "A year ago, there was only one AI lab driving infrastructure expansion, but now we are in a golden age with new labs and startups emerging everywhere." He also stressed that "Rubin," NVIDIA's next-generation AI chip, which has now entered full-scale mass production, was developed for this very moment.
NVIDIA said the current earnings momentum is expected to continue into the third quarter of its fiscal year, from August to October. The company projected third-quarter revenue at $108 billion, or about 149.5 trillion won. That is above analysts' estimate of $104 billion.
Free cash flow for the second quarter also reached $21.3 billion, up 58.7% from a year earlier. However, accounts receivable, or money owed for products already delivered, rose sharply to $63 billion, or about 87 trillion won, from $38.5 billion six months earlier. Colette Kress, NVIDIA's Chief Financial Officer, explained that "payment terms for high-quality customers and multi-quarter contracts have been extended, so the collection period for receivables has increased from 45 days to 60 days."
Meanwhile, NVIDIA is still struggling in the Chinese market. Kress said revenue was generated in the second quarter from sales of the previous-generation AI chip Hopper in China, but that it accounted for less than 1% of total data center revenue. She also said the company's third-quarter revenue outlook does not include the Chinese market.
NVIDIA shares, which closed down 1.59% in regular trading that day, jumped 4.2% in after-hours trading following the earnings release and were fluctuating around $218 as of 6:53 p.m. Eastern Time.
[email protected] Park Jong-won Reporter