Thirteen months ago, NVIDIA's stock was trading at around $33. In recent days, the stock has surged past $210 for the first time in over a year, marking a stunning "miracle" of growth in just under two years. This dramatic rise has captured the attention of investors and analysts alike.
Recently, NVIDIA released its third-quarter fiscal 2018 financial results after the U.S. market closed on Thursday. The numbers exceeded Wall Street expectations, sending the stock higher by 3.2% following the announcement. The strong performance highlights the company’s continued momentum in key markets.
In the quarter, NVIDIA reported total revenue of $2.636 billion, a 32% increase from the same period last year and significantly above the $2.36 billion expected by analysts. Net income reached a record high of $838 million, up 55% year-over-year, surpassing the $592 million forecast by analysts. These results show that NVIDIA is not only growing but also improving profitability.
This performance reversed a two-day decline in the stock price, pushing it back to a new high of $210. Just 13 months ago, on January 1, 2016, the stock opened at $33, meaning the current price is more than six times higher. Despite this sharp rally, some analysts believe the stock is still undervalued, with some raising their target price as high as $250.
So why are investors so bullish on NVIDIA? What drove such strong performance in the third quarter, and can this momentum continue?
First, the overall data keeps rising
While both revenue and net profit rose in the third quarter, the year-over-year growth rates of 32% and 55%, respectively, are impressive. Even more notable is that net profit grew faster than revenue, indicating improved efficiency within the company.
Second, GPU sales remain strong, with manageable costs
GPU and Tegra processors remain the main revenue drivers for NVIDIA. In the third quarter, GPU revenue reached $2.217 billion, up 31% from the same period last year. This growth was fueled by strong demand for Pascal-based gaming graphics cards and rapid expansion in the data center segment.
Although GPU revenue is much higher than Tegra, the latter saw a much larger year-over-year increase of 74%. This growth came from automotive applications, including the Nintendo Switch, which uses Tegra chips.
Looking beyond revenue, cost management is also important. R&D expenses increased by 11% to $462 million, while sales, general, and administrative costs rose by 24%. However, these increases are relatively modest compared to the company’s overall growth trajectory.
NVIDIA has maintained steady R&D investment over the past three years, with quarterly fluctuations typically limited to single digits. The recent 11% jump suggests the company may be preparing for a major product launch, though details remain under wraps for now.
Third, gaming remains the largest revenue driver
Despite the success of other segments, the gaming business continues to be the backbone of NVIDIA’s revenue. It generated $1.561 billion in the quarter, making up 59% of total revenue. This shows that the demand for gaming GPUs is still strong.
However, other segments are also showing significant progress. The data center business grew by an impressive 109% year-over-year, reaching over $500 million for the first time. This indicates that NVIDIA is successfully expanding into new markets.
Fourth, CEO Huang Renxun shares his vision
NVIDIA CEO Jensen Huang shared his thoughts on the company’s performance in a statement: “The various growth drivers have enabled us to achieve a strong quarter. We are also encouraged by the global push toward accelerating AI adoption.â€
He also highlighted several key developments: the Volta architecture GPU has gained traction among hardware and cloud providers, TensorRT 3.0 is boosting growth in large-scale data centers, and GeForce and Nintendo Switch GPUs are entering a phase of strong industry growth. Additionally, the Drive PX Pegasus autonomous driving platform is gaining more interest from companies.
Overall, NVIDIA is well-positioned for continued growth.
V: Summary
With strong leadership and a solid technical foundation, NVIDIA is moving forward with confidence. While the company’s own statements are encouraging, the broader industry response is the real indicator of its success.
On November 7, AMD announced that Raja Koduri, its senior vice president and chief GPU architect, had left the company. Just a day later, Intel confirmed that Koduri had joined them as Chief Architect and Senior Vice President in a newly formed group focused on core and visual computing.
According to Intel’s blog, Koduri will lead efforts to integrate and expand intellectual property across computing, graphics, media, and machine intelligence, targeting clients, data centers, and AI. While AMD and Intel have long histories, their recent moves suggest they are responding to pressure from NVIDIA, which has been dominating the GPU and AI space.
As both competitors ramp up their efforts, the question remains: Can NVIDIA maintain its pace and continue to deliver innovative products? Only time will tell, but for now, the company looks stronger than ever.
Solar lighting systems use solar cells to convert solar energy in nature into electricity and provide it to LED light sources. Due to the low voltage, energy saving and long-term characteristics of LED light sources, the application of solar LED lighting systems will achieve high energy efficiency, reliability, and practical value.
Solar panels are used to receive solar radiation during the day and convert light energy intoelectrical energy stored in the storage Battery by controller while the battery starts discharging and illuminate the light source in the evening. In the morning, the controller will switch off the battery and stop discharging according to the illuminance. The main function of the controller is to control the street lamp switch, adjust the brightness, and protect the battery to prolong the service life.
Solar Lights,Solar Lights,Led Lights,Garden Decoration, Led Street Lights,Led Lamp
Wuxi Sunket New Energy Technology Co.,Ltd , https://www.sunketsolar.com