The Blackwell platform was fully put into operation, laying the foundation for trillion-dollar parameter-level AIGC. At the same time, the iteration of Spectrum-X enables large-scale AI to enter Ethernet-only data centers.
The Zhitong Finance App learned that Guojin Securities released a research report that Nvidia (NVDA.US) AI training and inference requirements are driving volume on the Hopper platform, while AIGC is expanding from cloud vendors to more types such as the consumer internet, creating multiple multi-billion dollar vertical markets. The Blackwell platform was fully put into operation, laying the foundation for trillion-dollar parameter-level AIGC. At the same time, the iteration of Spectrum-X enables large-scale AI to enter Ethernet-only data centers. Downstream demand continues to rise, and the new GPU platform is successfully put into operation. The company's leading position is stable, and a new flashpoint in performance has emerged, maintaining Nvidia's “buy” rating.
Brief performance review:
On May 23, 2024, the company released financial results for the first quarter of fiscal year 2025:
1) FY1Q25 operating conditions: Single-quarter revenue of US$26.04 billion, YoY +262%, QoQ +18%, guidance was US$24 billion (+ -2%), and performance exceeded expectations. The data center reached a record high with revenue of $22.6 billion, YoY +427%, and QoQ +23%.
2) FY2Q25 Performance Guidelines: Revenue is estimated to be US$28 billion (fluctuating 2% up and down). GAAP and non-GAAP gross margins are expected to be 74.8% and 75.5% respectively (both fluctuate 0.5% up and down), and FY25's annual gross margin is approximately 75%.
Business analysis:
The company's next performance release is coming soon. The demand for AI training and inference is driving volume on the Hopper platform, while AIGC is expanding from cloud vendors to more types such as the consumer internet, creating multiple multi-billion dollar vertical markets. The Blackwell platform was fully put into operation, laying the foundation for trillion parametric AIGC. At the same time, the iteration of Spectrum-X enables large-scale AI to enter Ethernet-only data centers. Downstream demand continues to rise, and the new GPU platform is successfully put into operation. The company's leading position is stable, and a new flashpoint in performance has emerged.
The breakdown and analysis of the business situation in a single quarter is as follows:
1) Revenue side: Data center revenue of $22.6 billion, QoQ +23%, YoY +427%. Gaming revenue of $2.6 billion, QoQ -8%, YoY +18%. Professional visualization revenue of $427 million, QoQ -8%, YoY +45%. Autonomous driving and robotics revenue was US$329 million, QoQ +17%, YoY +11%. The high increase in data center revenue is due to: 1) Hopper GPU shipments for large model training and inference, recommendation engines, and AIGC continue to increase; 2) demand from all types of customers is growing, and cloud vendors continue to expand the deployment of AI infrastructure, contributing to the main growth of data centers, accounting for about 40% of revenue.
2) Margin side: The company achieved GAAP and non-GAAP gross margins of 76% and 76.7% respectively, +2.0pct and 1.7pct month-on-month, respectively, higher than the previous guidance range. The gross margin guidance for the next quarter declined slightly to 74.8% and 75.5% (fluctuating 0.5%). The increase in gross margin is mainly due to a decline on the cost side, and gross margin is expected to stabilize at around 75% for the whole year.
3) Profit side: The company achieved GAAP net profit of US$14.881 billion, QoQ +21%, YoY +628%. Diluted EPS is $5.98, QoQ +21%, Yo
We expect the company's net profit for 24-26 to be 692.2/1039.0/139.79 billion US dollars, corresponding EPS of 27.69/41.56/55.92 US dollars, continuing to maintain the “buy” rating.
Y +629%. In order to improve investors' access to the company's shares, the company announced that it will carry out a 1 split and 10 share split plan after the market on June 7, while increasing its quarterly cash dividend by 150%, from $0.04 per common share to $0.10 per share (corresponding to $0.01 after the split).
Profit forecasts, valuations, and ratings
We expect the company's net profit for 24-26 to be 692.2/1039.0/139.79 billion US dollars, corresponding EPS of 27.69/41.56/55.92 US dollars, continuing to maintain the “buy” rating.
Risk warning
Demand for terminals is not as good as expected; AI development is not as good as expected; the US is tightening sanctions against China.