Nvidia quarterly profit soars on demand for AI chips

SAN FRANCISCO, United States — Nvidia on Wednesday said its profit soared to $12.3 billion in the recently ended quarter on record high revenue driven by demand for its chips to power artificial intelligence.

The Silicon Valley chip titan reported profit of $12.3 billion on record revenue of $22.1 billion in the quarter than ended late January and record high revenue of $60.9 billion for the fiscal year.

Profit in the same quarter a year ago was $1.4 billion, while revenue in the same three-month period a year earlier was $6 billion, the company said.

"Accelerated computing and generative AI have hit the tipping point," Nvidia chief executive Jensen Huang said during an earnings call.

"Demand is surging worldwide across companies, industries and nations."

Nvidia shares shot up more than eight percent to $732.99 in after-market trade that followed the release of the earnings results.

"The AI Revolution starts with Nvidia and in our view the AI party is just getting started," Wedbush analyst Dan Ives said in a note to investors.

Wedbush expects 60 percent or more of businesses to "head down the AI use case path" in the coming decade, spending an estimated trillion dollars on the technology, according to Ives.

Money taken in by the Nvidia unit specializing in data center computing hit a record of $18.4 billion in the quarter, more than quadruple the amount from the same period a year earlier, according to Nvidia.

"Our Data Center platform is powered by increasingly diverse drivers," Huang said.

"Vertical industries — led by auto, financial services and healthcare — are now at a multibillion-dollar level."

The company said it expects total revenue of $24 billion in the current quarter.

Huang said Nvidia chips are at the heart of datacenters transforming into "AI generation factories" with data a "raw material" turned into experiences such as prompt-generated videos made using OpenAI's new Sora tool.

In regions outside the United States, "sovereign AI" systems are adding to demand for Nvidia chips, according to chief financial officer Colette Kress.

She described sovereign AI as large language models made using regional data and supported by local research and