Nvidia CEO Jensen Huang said computing has reached an ‘inflection point,’ as AI moves from training models to inference|@Nvidia|X
Nvidia reported record revenue and offered an upbeat outlook that pointed to continued demand, but investors remained skeptical.
Nvidia’s fiscal year profit soared to $120 billion, the company said Wednesday, easing fears that the artificial-intelligence boom may be slowing.
The chipmaker earned $43 billion in profit in the fourth quarter, up from $22.1 billion a year ago. Revenue reached $68.1 billion, up 73% from a year ago.
Only a few companies, including Alphabet, Microsoft, and Apple, have ever earned $100 billion in yearly profit. None has grown as fast. Just three years ago, Nvidia earned $4.4 billion.
AI drives the business
Chief Executive Jensen Huang said computing has reached an “inflection point,” as AI moves from training models to inference, the stage where AI systems answer real-world queries.
Data center sales, mainly AI chips and networking equipment, accounted for 91.4% of revenue, or $62.3 billion. Gross margins improved to 75%, up from 73% a year ago. Nvidia expects $78 billion in revenue this quarter (excluding data center revenue), well above analysts’ $72.9 billion forecast.
Shares, which had fallen to $170.94 in December amid AI bubble concerns, have recovered to around $196.
Nvidia now controls about 90% of the high-end AI chip market. It stands to benefit most as Google, Amazon, and Meta plan to spend $650 billion this year on AI data centers.
Despite strong results, pressure remains intense. With a market value near $5 trillion, Nvidia must keep exceeding expectations. However, rising competition and uncertainty over China sales remain key risks.
Some investors question the durability of this outsized growth for Nvidia. But Huang told analysts yesterday that AI’s accelerating adoption gives him confidence that the company’s growth story is far from over.