- NVIDIA, the microchip design and manufacturer, reported results for the fourth quarter of 2023, revealing a 21% decrease in revenue in comparison to the same period in the previous year. However, there was a 2% increase from the previous quarter.
- Non-GAAP earnings per diluted share for the fourth quarter were $0.88, indicating a 33% decrease compared to the previous year but a 52% increase from the previous quarter.
- For the fiscal year 2023, the company’s revenue was $26.97 billion, flat from a year ago. Non-GAAP earnings per diluted share were $3.34, down 25% from a year ago.
- NVIDIA’s CEO and founder, Jensen Huang, plugged AI as being at an inflection point, setting up for broad adoption reaching into every industry, adding that they are seeing increased interest in the versatility and capabilities of generative AI. Gross margins for the fourth quarter jumped by 10% to 66.1%, but for the FY 2023 were down to 59.2% from 66.8% the year before.
- The company made progress in various areas since the last earnings announcement, including the Data Center, where it achieved a revenue of $3.62 billion in the fourth quarter, representing an 11% increase from the previous year.
- In Gaming, fourth-quarter revenue amounted to $1.83 billion, down 46% from a year ago, but up 16% from the previous quarter. Professional Visualization’s fourth-quarter revenue was $226 million, a 65% decrease compared to the previous year.
- And NVIDIA’s Automotive and Embedded sector achieved a record revenue of $294 million in the fourth quarter, a 135% increase from the previous year.
- During the fourth quarter of 2023, NVIDIA returned $1.15 billion in share repurchases and cashdividends, bringing the return for the fiscal year to $10.44 billion. The company’s outlook for the first quarter of fiscal 2024 is that revenue will be $6.50 billion, plus or minus 2%, with GAAP and non-GAAP gross margins expected to be 66.2% and 66.6%, respectively.
- Nvidia is relying heavily on the 2023 AI buzzword to help investors envisage its growth potential. However, it is trading on a Price to earnings ratio of 100x, which is incredibly expensive. We are instead holders of and prefer Taiwan Semiconductor Manufacturing Company (TSMC) in the microchip fabrication industry.
By Lee Kern
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