On Wednesday, Nvidia disclosed its financial outcomes for the final quarter of fiscal 2024 and the entire year, concluding on January 28, 2024. The company unveiled quarterly earnings of \(22.1 billion and annual sales of \)60.9 billion, achieving two unprecedented all-time highs as the demand for its AI, HPC, and gaming products soared.
Jensen Huang, Nvidia’s founder and CEO, expressed, “Accelerated computing and generative AI have reached a significant milestone. Demand is escalating globally across various companies, industries, and nations.”
Record-Breaking Performance
Nvidia’s revenue for the fourth quarter of fiscal year 2024 surged to \(22.103 billion, marking a remarkable 265% surge compared to the same quarter in the preceding year. The company’s net income soared to \)12.285 billion, accompanied by a notable enhancement in gross margin, which rose to 76% from 63.3% in the fourth quarter of fiscal year 2022. For the entirety of fiscal year 2024, Nvidia reported total revenue of \(60.922 billion, reflecting a substantial 126% increase from \)26.974 billion in FY 2024. The company’s net income for the year witnessed a significant rise to \(29.760 billion, up from \)10.02 billion in 2022.
Huang highlighted, “Our Data Center platform is being propelled by a diverse array of drivers—ranging from the demand for data processing, training, and inference from major cloud-service providers and GPU-specialized entities to enterprise software and consumer internet companies. Various vertical industries, notably automotive, financial services, and healthcare, have now reached a multibillion-dollar scale.”
Datacenter Dominance
Nvidia has been a prominent vendor of Datacenter hardware for an extended period, but in fiscal 2024, it essentially transformed into a datacenter-centric company as sales of its AI, HPC GPUs, and networking equipment overshadowed other segments.
In the fourth quarter of fiscal 2024, Nvidia’s datacenter revenue totaled \(18.404 billion, up from \)14.514 billion sequentially and significantly higher than the \(3.616 billion reported in the same quarter a year earlier. Throughout FY2024, Nvidia garnered \)47.525 billion from datacenter hardware, marking a substantial 217% surge year-over-year from $15 billion in FY2023.
Colette Kress, Nvidia’s CFO, noted, “These increases are attributed to the heightened shipments of the Nvidia Hopper GPU computing platform utilized for training and inference of large language models, recommendation engines, and generative AI applications, along with InfiniBand end-to-end solutions.”
It is worth noting that datacenter sales to China experienced a notable decline in Q4 FY2024 due to U.S. government licensing requirements, effectively prohibiting the sale of high-performance AI and HPC GPUs to China. While approximately 19% of Nvidia’s datacenter revenue originated from China in FY2023, this figure dropped to 14% in FY2024.
China remains a significant Nvidia customer, and the company anticipates that sales to Chinese firms will constitute 14% in Q1 FY2025.
Graphics Segment
Although not reaching historical peaks, Nvidia’s Gaming Business unit reported revenue of \(2.865 billion, representing a slight increase quarter-over-quarter and a 56% surge year-over-year. The company’s total earnings from gaming hardware for the year amounted to \)10.447 billion, reflecting a 15% increase year-over-year.
Kress stated, “The year-on-year growth for the quarter and fiscal year is a result of increased sell-in to partners following the normalization of channel inventory levels and rising demand. The introduction of our GeForce RTX 40 Super-series GPUs also contributed to the revenue in the quarter.”
In terms of Professional Visualization, Nvidia garnered \(463 million in Q4 FY2023 (up 105% YoY) and \)1.553 billion for the entire year, maintaining a stable performance compared to fiscal 2023.
Kress explained, “The sequential upturn was primarily driven by the deployment of desktop workstations based on the Ada Lovelace GPU architecture.”
Graphics product sales totaled $13.517 billion in fiscal 2024, marking a 14% increase year-over-year.
Automotive, OEM, and Other Sectors
While Nvidia’s datacenter business experiences rapid growth, with gaming and ProViz segments flourishing, the same cannot be said for the company’s other divisions. Nvidia’s automotive business generated \(281 million in Q4 FY2024, down from \)294 million in the corresponding quarter of the previous year, whereas revenue from OEM and other sectors reached \(90 million. Automotive revenue for the entire year amounted to \)1.091 billion, up 21% from the previous year, while sales to OEMs declined by 33% to $306 million year-over-year.
Q1 Outlook
Given the persistent strong demand for Nvidia’s Hopper-based AI and HPC platforms, the company anticipates that revenue for the first quarter of fiscal 2025 will range around $24 billion ± 2%. The GAAP gross margin is projected to be 76.3%.
