Nvidia gives strong forecast driven by gamer, data center demand

    The sales prediction compares with a $5.49 billion average analyst estimate, according to data compiled by Bloomberg.
    By BLOOMBERG
    | Updated on May 27 2021, 07:44 AM IST
    FILE PHOTO: The logo of Nvidia Corporation is seen during the annual Computex computer exhibition in Taipei, Taiwan May 30, 2017. REUTERS/Tyrone Siu/File
    FILE PHOTO: The logo of Nvidia Corporation is seen during the annual Computex computer exhibition in Taipei, Taiwan May 30, 2017. REUTERS/Tyrone Siu/File (REUTERS)
    FILE PHOTO: The logo of Nvidia Corporation is seen during the annual Computex computer exhibition in Taipei, Taiwan May 30, 2017. REUTERS/Tyrone Siu/File
    FILE PHOTO: The logo of Nvidia Corporation is seen during the annual Computex computer exhibition in Taipei, Taiwan May 30, 2017. REUTERS/Tyrone Siu/File (REUTERS)

    Nvidia Corp., the largest U.S. chipmaker by market value, gave a bullish forecast on demand for chips used in gaming PCs and data centers. Revenue in the current quarter will be about $6.3 billion, plus or minus 2%, the Santa Clara, California-based company said in a statement late Wednesday. 

    The adjusted gross margin, or the percentage of revenue left after deducting costs, will be 66.5%, the company said. The sales prediction compares with a $5.49 billion average analyst estimate, according to data compiled by Bloomberg.

    Also read: Looking for a smartphone? To check mobile finder click here.

    Founder and Chief Executive Officer Jensen Huang has drawn investors to his company’s stock by persuading owners of data centers that are the backbone of the internet that his graphics chips are key to artificial-intelligence-based computing.

    That’s caused a surge in revenue that some investors are now concerned has peaked.

    Nvidia is one of the pioneers of outsourcing production and has never owned its own factories. Like its peers and rivals it’s dependent on Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co. for manufacturing at a time when the whole industry is experiencing a spike in demand as parts of the world economy emerge from the depths of the pandemic. Nvidia has said shortages have constrained its growth.Fiscal first-quarter revenue rose 84% to $5.66 billion and profit excluding certain costs was $3.66 a share in the period, which ended May 2, the company said. Analysts, on average, predicted earnings of $3.31 a share on sales of $5.41 billion.

    Nvidia reported data center chip sales rose 79% to $2.05 billion in the fiscal first quarter from a year earlier. Revenue from gaming doubled to $2.76 billion in the quarter.The stock was down less than 1% in extended trading following the announcement. It closed at $628 in New York Wednesday, leaving it up 20% in 2021. Last week Nvidia announced that it will split its stock 4 for 1 to try to accessible to investors and employees.

    Follow HT Tech for the latest tech news and reviews , also keep up with us on Twitter, Facebook, and Instagram. For our latest videos, subscribe to our YouTube channel.

    First Published Date: 27 May, 07:42 AM IST
    Tags:
    NEXT ARTICLE BEGINS
    keep up with tech