Nvidia shares pass $US1000 for first time on AI-driven sales surge

Nvidia shares topped $US1000 for the first time in extended trading overnight Wednesday in the US after the chipmaker reported fiscal first-quarter results that topped analyst estimates. Nvidia’s quarterly earnings report has become a way for investors to gauge the strength of the AI boom that has transfixed markets in recent months. Its strong results suggest that demand for the AI chips Nvidia makes remains robust, and chief executive Jensen Huang said the company would see revenue from its next-generation AI chip, called Blackwell, later this year. The stock rose 7 per cent in extended trading. Nvidia also said it was splitting its stock 10 to 1. Based on the after-market move, the shares are poised to reach a fresh high on Thursday. Nvidia said it expected sales of $US28 billion in the current quarter. Wall Street was anticipating earnings per share of $US5.95 on sales of $US26.61b. The chipmaker reported net income for the quarter ended April 28 of $US14.88b, or $US5.98 per share, compared with $US2.04b, or US82¢, in the year-earlier period. In the past year, Nvidia sales have skyrocketed as companies such as Google, Microsoft, Meta, Amazon and OpenAI buy billions of dollars of Nvidia’s graphics processing units, which are advanced and pricey chips required for developing and deploying artificial intelligence applications. The company’s largest and most important business is its data centre sales, which includes its AI chips as well as many of the additional parts needed to run big AI servers. Nvidia said its data centre category rose 427 per cent from the year-ago quarter to $US22.6b in revenue. Nvidia finance chief Colette Kress said in a statement that it was due to shipments of the company’s Hopper graphics processors, which include the company’s H100 GPU. “A big highlight this quarter was Meta’s announcement of Lama 3, their latest large language model which used 24,000 H100 GPUs,” Ms Kress said on a call with analysts. She added that large cloud providers make up about “mid-40 per cent” of Nvidia’s data centre revenue. Even as the company reports a tripling or more of its business, Mr Huang said that the company’s next-generation AI GPU, called Blackwell, would lead to more growth. “We will see a lot of Blackwell revenue this year,” the CEO said on a call with analysts, adding the new chip would be in data centres by the fourth quarter. Nvidia also highlighted strong sales of its networking parts, which are increasingly important as companies build clusters of tens of thousands of chips that need to be connected. Nvidia said that it had $US3.2b in networking revenue, primarily its InfiniBand products, which was over three times higher than sales in the year-earlier period. Nvidia, before it became the top supplier to big companies building AI, was known primarily as a company making hardware for 3D gaming. Gaming revenue was up 18 per cent during the quarter to $US2.65b, which Nvidia attributed to strong demand. The company also sells chips for cars and chips for advanced graphics workstations, which remain much smaller than its data centre business. It reported $US427 million in professional visualisation sales, and $US329m in automotive sales. Nvidia said it bought back $US7.7b worth of its shares and paid $US98m in dividends during the quarter. Nvidia also said that it’s increasing its quarterly cash dividend from US4¢ per share to US10¢ on a pre-split basis. After the split, the dividend will be US1¢ a share. CNBC