According to WCCFTech, NVIDIA Corporation just reported their quarterly earnings figure for the second quarter of the fiscal year 2019. It turns out that the company managed to lower third-quarter guidance by about a hundred million dollars. While its second-quarter revenue and earnings proved to be a success (beating all shown estimates), it share prices significantly dropped by 5 percent.
As far as the revenue for the second quarter of this year is concerned, NVIDIA reached $3.12 billion. It is quite a jump if compared to the second quarter of the fiscal year 2018, which was around $2.23 only. More importantly, the company is happy to reveal growth across its several platforms, particularly the ones that build its products.
It is safe to say that the overall theme seems to be at the right direction for the company. However, according to the president and CEO of NVIDIA, Jensen Huang, the company was spiraling down revenue meant for the upcoming quarter. He said that the move, which he gave as instructions to investors, is due to the fall of cryptocurrency-driven demand for the company’s GeForce video card products.
There is no doubt that NVIDIA is doing great in its core business, which is PC gaming. Although the earnings game can go up and down, depending on a lot of factors, the numbers that the company presented were quite solid. There were other segments running a bit flat when it comes to sequential growth, though.
Huang heavily emphasized the company’s goal to nurture “growth across every platform.” This could be anything from AI to Gaming to Professional Visualization to self-driving cars. And, so far, this growth has helped them reached yet another great quarter.
The CEO said that fueling their growth has always been “the widening gap between demand for computing across every industry and the limits reached by traditional computing.” He added that developers have shown to be jumping on the GPU-accelerated computing model, which is something that NVIDIA really pioneered to help achieve the boost these developers need.
NVIDIA’s gross corporate margin was reportedly at 63.5 percent for the aforementioned quarter. For comparison, AMD has been having a hard time maintain over 35 percent and has even stated to be happy if it reaches 40 percent gross margins. Keep in mind, however, that the latter would already include CPU and GPU products, including semi-custom low margin (i.e. console SoCs).
It is true that the company somehow adjusted revenue guidance specifically for the third quarter, which is down to $3.25 from the initial $3.34 billion. As mentioned above, this is somehow due, in part, to Cryptocurrency demand falling off.
Nonetheless, this does not stop NVIDIA from announced its upcoming next generation of Geforce video cards, the RTX 2080. If the company is able to post and maintain such strong growth in its gaming division with Pascal cards, then it is really possible for the company to drive further revenue growth in its most important product line.
Meanwhile, NVIDIA is looking to roll out a top-to-bottom product stack, one that is heavily based on the revised 12nm node. Interestingly, it is said to be positioned strategically in order to bridge the gap until next-gen 7nm parts arrive in the latter part of next year. It seems these Turing products will come with some real improvements and quality additions, all of which are under the hood. Basically, it is not just a half-node shrink from what was once the TSMC’s 16FF process. And since the company does not really have competition in sight – at least from now – from the Radeon team, growth is expected to be only checked via by market demand. Apparently, this is a very interesting position for any company to be in.