Nvidia makes surprise profit

surprised-newspaper-readerNvidia has reported a surprise rise in second quarter revenues and gave a better than expected revenue forecast for the current quarter.

It was all down to a strong demand for its graphic chips used in gaming and cars.

Nvidia’s revenue increased 4.5 percent in the quarter ended July 26, while the cocaine nose jobs of Wall Street had predicted revenue to decrease about eight percent.

The outfit predicted sales would fall in the third quarter, but the decline was less than Wall Street expected.

Nvidia gets most of its cash from its graphic chips made for PCs. There were fears the fall in PC sales would hurt Nvidia just like it did Intel and AMD.

The outfit said gaming revenue rose 59 percent, helped by strong sales of its GeForce series of gaming chips.

Nvidia has also been making chips that allow people to play graphics heavy games over the internet and chips used in a car’s dashboard display and in self driving cars.

Automotive revenue rose 76 percent and accounted for only 6.2 percent of total revenue.

The company said eight million cars on the road were using its chips and that it was working with more than 50 companies for its DRIVE chip for self driving cars.

Revenue in Nvidia’s enterprise business fell 14 percent. The business, which makes chips used for software such as AutoCAD, accounted for 16.2 percent of total revenue.

The outfit’s total revenue rose 4.5 percent to $1.15 billion in the second quarter. Analysts had expected $1.01 billion.

Net income fell nearly 80 per cent to $26 million in the quarter because of higher costs and a bigger tax bill.

Nvidia forecast revenue to fall to $1.16-$1.20 billion in the current quarter from $1.23 billion a year earlier. Analysts had expected a fall to $1.10 billion.