What Drove Nvidia’s Revenue Growth in Fiscal 4Q18?


Feb. 15 2018, Published 8:21 a.m. ET

Nvidia beat both earnings and revenue estimates

Chipmaker Nvidia (NVDA) reported its fiscal 4Q18[1. fiscal 4Q18 ended December 31, 2017] earnings on February 8, 2018. The company handily beat both earnings and revenue estimates.

Nvidia’s revenues grew 34.0% in fiscal 4Q18 from fiscal 4Q17 to ~$2.9 billion, which was higher than Wall Street estimates of ~$2.7 billion. The company’s revenues for fiscal 2018 stood at ~$9.7 billion.

Nvidia generated EPS (earnings per share) of $1.78 in fiscal 4Q18, while analysts expected $1.17 per share. However, its earnings beat was partly due to the $133.0 million windfall in fiscal 4Q18 due to the recently passed Tax Cuts and Jobs Act.

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Gaming and data center saw robust growth

Gaming, which is Nvidia’s (NVDA) biggest segment, generated revenues of ~$1.7 billion against analysts’ estimates of ~$1.5 billion. The company noted that the popularity of the Nintendo Switch was a contributor to the uptick in its Gaming segment’s revenues.

Nvidia’s revenues from its second-largest segment, the Data Center business, grew to $606.0 million in fiscal 4Q18 and more than doubled year-over-year.

Nvidia stock fell 4.9% on February 8, as 97.0% of the stocks in the S&P 500 (SPX-INDEX) shares declined on the day. However, after its earnings were announced after the market closed, NVDA stock ticked up 10.2% in after-hours trading. The company’s stock has returned nearly 85.0% in the last 12 months.


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