Nvidia Reports Record $26 Billion in Earnings in the First Quarter, Declares a 10-to-1 Split to Its Stock

Nvidia realized $26 billion in the quarter ending April 28, 18% more than the previous quarter’s $22 billion revenue. The quarterly performance beat Wall Street’s high forecast with earnings of 262% of the prior year.

Nvidia reported record earnings of $26 billion in the first quarter, easily surpassing Wall Street expectations and prompting the chipmaker to announce a 10-to-1 split for its stock.

In the quarter that ended April 28, Nvidia generated $26 billion in revenue, an 18% increase over the previous quarter's $22 billion. The quarterly performance smashed Wall Street's highest forecast, with earnings that were 262% of the prior year.

Demand For AI Factories Pushes Quarterly Earnings To 25 Billion

According to Nvidia chief executive and founder Jensen Huang, the industrial revolution is taking off, with global companies and countries partnering to transform trillion-dollar data centers into accelerated computing. Nvidia is preparing to accelerate computing and enable the development of data centers that are being designed as AI factories behind artificial intelligence, assured the executive.

Huang reiterated his previous statement that AI is set to bring unimaginable productivity gains to almost all sectors. The Nvidia chief noted that AI will help companies become more energy- and cost-efficient while optimizing their revenue opportunities.

The chief executive of Nvidia downplayed concerns that AI will take over job opportunities currently filled by human workers. He ruled out any evidence for a company that would not hire additional people after increased productivity optimizes earnings.

Nvidia Reports 23% Data Center Earnings Growth

Nvidia disclosed that its first-quarter earnings for the data center grew 23% from the previous quarter to $22.6 billion. The record earnings were 427% up from the last year.

Huang attributed the record-earning growth to the accelerated demand for the chipmaker's Hopper graphics processing units (GPUs). Nvidia acknowledged that the high demand arises from GPU utilization in training and developing large language models (LLMs), the usage of which is spreading every day.

During the earnings call, Nvidia acknowledged that the high demand for the H200 and Blackwell chips outlived the supply. Despite an alleged pause as clients await Blackwell, Huang admitted that Nvidia is still experiencing high demand for the Hopper (H200) chips.

During the earnings call, Huang assured that Nvidia plans to ship the Blackwell platform in the second quarter. Besides, he added that the shipping will ramp up in the subsequent quarter, reaching the customers in the final quarter.

While Nvidia will reap earnings from the Blackwell later this year, Huang indicated another chip is scheduled. The subsequent chipmakers will align to the one-year rhythm.

Nvidia revealed that its gaming revenue rose by 18% compared to last year's first quarter. However, the demand failed to match the previous quarter, evident in the 8% dip in earnings.

Nvidia Crosses $1000 In After-Trading Hours

A review of the chipmaker's share price shows it dipped 0.4% hours before the earnings report to exchange hands at $949.50 at the market close Wednesday, May 22 evening. As per MarketWatch data, such portrayed a decline from the record-high $953.86 attained the day before.

Nvidia shares would surge by over 6% after-hours trading to lift the NVDA prices to an all-time high above the $1,000 threshold.

Nvidia stock replicates previous trends, particularly hours before reporting its quarterly earnings. In February, NVDA suffered a $78 billion erosion in the market value 24 hours before the earnings call. However, Nvidia stock has surged 209% over the past 12 months since the fourth quarter earnings call.

The unveiling of Blackwell as Nvidia's newest chip prompted Wall Street analysts to forecast higher growth in the firm's earnings. However, some analysts appeared calm and concerned that the present chips would result in pause orders before the Blackwell shipments.

Huang assured that Nvidia was on course for the subsequent growth wave, indicating that it was producing the Blackwell chips fully. He added that the Blackwell chips constituted a critical foundation that would propel the trillion-parameter-scale for the generative AI.

Nvidia Announces 10-For-1 Split For NVDA Stock

Nvidia attributed the demand for the Hopper chips behind the powerful AI models to propel it to realize the $2 trillion market capitalization and become the first chipmaker in February. The rally in the stock catapulted Nvidia to rank third globally as a valuable entity in March.

Nvidia is optimistic about replicating growth in revenue generation, with the second-quarter earnings set at $28 billion with a 2% variance. Lastly, the chipmaker declared a 10-for-1 split for its NVDA stock, set to begin trading on June 10 when the market opens.