Nvidia shares inched higher early Thursday as the tech bellwether reported better-than-expected fiscal fourth-quarter results and provided a revenue outlook above market estimates at the midpoint for the ongoing three-month period. The chipmaker's adjusted earnings came in at $0.89 a share for the quarter ended January 26, increasing from $0.52 the previous year.
The consensus on FactSet was for non-GAAP EPS of $0.85. Revenue surged 78% year over year to $39.33 billion, surpassing the Street's predicted figure of $38.1 billion. The stock rose about 1% in the most recent premarket activity. For the current quarter, the company expects revenue to reach $43 billion, plus or minus 2%, while the current average analyst estimate on FactSet stands at $42.75 billion.
The gross margin on a GAAP basis is pegged at 70.6%, with a variation of plus or minus 50 basis points. Truist Securities noted in a client update that the tech giant's beats have become "smaller" over the last few quarters, with increases diminishing from double-digit percentage advantages six quarters ago to just 3% in the last quarter.
Revenue growth has also decreased to the 78% gain in the fourth quarter from an astonishing 264% a few quarters prior, according to the brokerage. Revenue from Nvidia's data center business soared by 93% to $35.58 billion in the fourth quarter, attributed to the commencement of the Blackwell ramp and continued sequential growth of the Hopper 200.
Chief Financial Officer Colette Kress remarked during an earnings call that Hopper is a graphics processing unit architecture, while Blackwell functions as a generative artificial intelligence system. Blackwell contributed $11 billion in revenue during the quarter, driven by robust demand, marking the "fastest" product ramp in the company's history, Kress mentioned on the call.
Sales were largely influenced by major cloud service providers, accounting for approximately 50% of the firm's data center revenue. Within the data center division, compute revenue experienced a staggering rise of 116% year over year, while networking revenue fell by 9%. In contrast, the gaming segment's revenue dipped to $2.54 billion from $2.87 billion in the 2024 quarter, due to limited availability of Blackwell and Ada graphics processing units, as noted by Kress.
Meanwhile, automotive division sales more than doubled to $570 million, thanks to the company's self-driving platforms, while revenue from professional visualization increased by 10% year on year. Kress remarked that given the strong demand, a significant ramp of Blackwell is anticipated in the first quarter.
The company expects to see sequential growth in both data center and gaming revenue during this upcoming quarter..