Nvidia (NASDAQ:NVDA) provided a strong forecast yesterday, despite supply constraints, after doubling profits and producing record sales in the holiday quarter.
Driven by exceptional demand for computing platforms, the company posted fourth-quarter revenue of $7.64 billion, up 53% year-over-year, and better than consensus estimates of $7.42 billion.
Gaming sales rose 37% to a record $3.42 billion from the year-ago quarter or a sequential gain of 6%. Data-center sales surged 71% to a record $3.26 billion from the year-ago quarter or a sequential growth of 11%.
However, flat gross margins from the previous quarter and concern about Nvidia's exposure to the crypto market pushed shares down 2.8% in after-hours trading.
On a call, Chief Executive Jensen Huang told analysts that business was constrained by supply, but he expected it to improve. According to analyst KinNgain Chan at Summit Insights Group, "a meaningful part of its gaming sales do include crypto-mining which we think could be volatile."
In fiscal 2022 ending Jan 30, Nvidia sold $500 million in crypto-specific cards and only $24 million in the fourth quarter.
Additionally, Nvidia paid $100 million in quarterly cash dividends during the quarter and $399 million for the full year. Over the past four years, the company's dividends have increased, leading to a dividend yield of 0.07%.
Turning to automotive revenue, Nvidia expects earnings to bounce back in the current quarter and gather pace during the second half of the fiscal year. Car revenue retreated 14% from the year-ago period, with supply constraints continuing to weigh down on production.
Earlier Wednesday, the chip company said it struck a partnership with carmaker Jaguar Land Rover to work on software-heavy cars, and Nvidia confirmed the termination of the Arm Limited Share Purchase Agreement with Softbank Group Corp citing regulatory challenges.
"We gave it our best shot, but the headwinds were too strong, and we could not give regulators the comfort they needed to approve our deal," Mr. Haung said.
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