Chipmaker Nvidia forecasts robust revenue on AI, metaverse buzz

The world’s biggest maker of graphics and AI chips expects fourth-quarter revenue to grow above analysts’ expectations.

Nvidia is benefitting from recent efforts such as artificial intelligence (AI) chips used in data centres and those for autonomous vehicles [File: Robert Galbraith/Reuters]

Nvidia Corp on Wednesday forecast fourth-quarter revenue above Wall Street expectations, betting on growth in its data centre business as more internet companies set out to invest in artificial intelligence and the metaverse.

The company’s shares were up nearly 4 percent in extended trading. They have more than doubled this year.

The world’s biggest maker of graphics and AI chips expects current-quarter revenue of $7.40bn, plus or minus 2 percent, above analysts’ average estimate of $6.86bn, according to IBES data from Refinitiv.

The coronavirus pandemic boosted demand for graphic chips used in gaming consoles and computers as consumers staying at home spent more time playing video games, with support also from cryptocurrency miners. The company is also benefitting from recent efforts such as artificial intelligence chips used in data centres and those for autonomous vehicles.

For the reported third quarter, revenue in Nvidia’s gaming unit rose 42 percent to $3.22bn and data centres surged 55 percent to $2.94bn.

Analysts had expected $3.13bn and $2.75bn for gaming and data centres respectively, according to FactSet.

Overall, revenue rose about 50 percent to $7.10bn for the three months ended October 31, above the average estimate of $6.83bn, according to IBES data from Refinitiv.

Source: Reuters

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