Nvidia, a prominent player in the technology industry, has announced that it achieved a remarkable milestone in sales, more than doubling its revenue due to the surging demand for its artificial intelligence (AI) chips. The company reported that its revenue for the three-month period ending in June surpassed $13.5bn (£10.6bn), marking a new record, BBC reports.
Anticipating a continued surge in sales during the current quarter, Nvidia has also disclosed its intention to repurchase $25bn worth of its own stock. This announcement further propelled the company's shares, which saw an increase of over 6.5% in after-hours trading on the New York Stock Exchange. This surge adds to the significant gains the company's shares have experienced throughout the year.
Looking ahead, Nvidia has projected a revenue of approximately $16bn for the quarter ending in September. This estimate significantly surpasses the expectations of Wall Street analysts and translates to a remarkable rise of around 170% compared to the same period the previous year.
Jensen Huang, Nvidia's CEO, conveyed a sense of a new technological era, highlighting the global shift from general-purpose computing to accelerated computing and generative AI. The company's exceptional performance was primarily driven by its data center division, which includes AI chips. This segment's revenue exceeded $10.3bn, marking a remarkable surge of over 170% compared to the previous year. Cloud computing service providers and prominent consumer internet companies played a pivotal role in driving this growth, as they embraced Nvidia's cutting-edge processors.
Throughout this year, Nvidia's market valuation has surpassed $1 trillion, with its shares more than tripling in value. This achievement propelled the company into the elite ranks of the "Trillion Dollar Club," a group of the five largest publicly traded U.S. companies, which includes Apple, Microsoft, Alphabet, and Amazon.
Sarah Kunst, Managing Director of Cleo Capital, an investment firm focusing on startups, expressed her fascination with the fervor surrounding Nvidia. She noted that despite Nvidia's long history in chip manufacturing, it was only in recent years that the market fully recognized its potential. Originally renowned for graphics processing chips used in computer gaming, Nvidia's hardware has now become foundational in the realm of AI applications. In fact, a report indicated that Nvidia commands a staggering 95% share of the machine-learning market.
Moreover, ChatGPT, the AI language model used here, was developed using Nvidia's graphics processing units (GPUs) in a supercomputer owned by Microsoft. The ongoing advancements in AI products are poised to revolutionize how we interact with computers and the significant roles they play in our lives.
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