Nvidia forecasts third-quarter revenue above estimates

By Stephen Nellis and Neha Malara (Reuters) - Nvidia Corp forecast third-quarter sales above expectations on Wednesday, riding the boom in artificial intelligence and cloud computing that has made it a semiconductor industry star and one of the fastest-rising U.S. tech stocks. The company, with a market cap that has eclipsed Intel Corp , also beat Wall Street expectations for the second quarter

Reuters August 20, 2020 03:05:33 IST
Nvidia forecasts third-quarter revenue above estimates

Nvidia forecasts thirdquarter revenue above estimates

By Stephen Nellis and Neha Malara

(Reuters) - Nvidia Corp forecast third-quarter sales above expectations on Wednesday, riding the boom in artificial intelligence and cloud computing that has made it a semiconductor industry star and one of the fastest-rising U.S. tech stocks.

The company, with a market cap that has eclipsed Intel Corp , also beat Wall Street expectations for the second quarter.

But results sent shares down 1.5% in trading after the bell. Before the market close on Wednesday, Nvidia's shares had gained more than 185% over the past year.

The chipmaker said it expects third-quarter revenue of $4.40 billion (3.33 billion pounds), plus or minus 2%, compared with analysts' estimates of $3.97 billion, according to IBES data from Refinitiv.

The company's data center segment reported second-quarter revenue of $1.75 billion beating estimates of $1.71 billion, according to FactSet data.

Nvidia's gaming business posted revenue of $1.65 billion, beating FactSet estimates of $1.41 billion.

Revenue rose nearly 50% to $3.87 billion in the second quarter ended July 26, Nvidia said, above Refinitiv IBES estimates of $3.65 billion.

Net income rose to $622 million, or $0.99 per share, in the quarter, from $552 million, or $0.90 per share, a year earlier.

On an adjusted basis, the company earned $2.18 per share in the quarter compared with analysts' estimates of $1.97 per share.

Nvidia was once primarily known for chips that helped video game graphics look more realistic. But more than a decade ago, Chief Executive and co-founder Jensen Huang placed a major bet on the rise of artificial intelligence applications such as the image recognition or natural language processing computing that powers everything from autonomous vehicle development to voice assistants.

The rise of those technologies helped make Nvidia the biggest U.S. chip company by market capitalization in July, when it overtook Intel, which has long dominated chips for both personal computers and inside data centers.

In recent weeks, Intel shares have plunged nearly 20% as the company struggles with its chip manufacturing operations while Nvidia shares have continued to rise, leaving Nvidia with a market cap of $301.6 billion before markets closed Wednesday compared with Intel' $206.9 billion.

(Reporting by Neha Malara in Bengaluru and Stephen Nellis in San Francisco; Editing by Shounak Dasguptaand Tom Brown)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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