On Thursday, American tech and graphics processor manufacturing company Nvidia Corp posted a massive earnings and revenue in line with consensus earnings estimates for the third quarter.
Nvidia shares which have rallied by more than 99% this year and more than 150% during the past twelve months by August were up by around 4% during the after-hours trading on Thursday to as much as $214.45 per share after the company posted double-digit growths for the third quarter which was expected by most analysts due to the surge in the demand for graphics processing units.
Companies such as Nvidia, Intel, and AMD were expected to post a rise in their sales during the past couple of quarters as the cryptocurrency market, gaming world, and even artificial intelligence developers sent prices of GPU prices up giving a bright outlook for the said companies.
For the third quarter, revenue of Nvidia posted earnings growth of 175% for their data center business attributed to the large-scale customer’s increasing demand especially those who are developing artificial intelligence.
Nvidia's revenue for the third quarter came in at $2.64 billion beating most analysts forecasts of $2.36 billion while their earnings stood at $1.33 per share compared to most expectations of 94 cents per share. The revenue of the company for the third quarter represents a growth of 32% from the same quarter last year while their earnings have risen by 41% year over year.
Earlier this year, Nvidia shares have received numerous target price upgrades from analysts following announcements from the company which will boost the sales of its products. A number of these includes
Nvidia’s announcement also revealed a system which will be called Pegasus has a target of developing driverless vehicles up to Level 5 which means that these vehicles will be completely operated by sensors or computers without the need for a steering wheel, pedal, or mirror function.
Nvidia is also currently developing a VR platform which has the potential to offer collaborative virtual environments to designers and developers. The plan which would be called the Holodeck can also be used by developers to train agents in the virtual space to test developments in real life conditions.
For the upcoming fourth quarter, Nvidia issued a guidance of $2.65 billion for their revenue and added that it will return $1.25 billion back to its shareholders and raise dividends from 7% to 15%.