NVIDIA (NVDA) Q2 Earnings And Revenues Surpass Estimates
Zacks Investment Research | Aug 15, 2019 10:46PM ET
NVIDIA’s (NASDAQ:NVDA) second-quarter fiscal 2020 non-GAAP earnings per share of $1.24 topped the Zacks Consensus Estimate of $1.15 but dropped 36% from the year-ago period. However, the bottom line improved 41% sequentially.
Meanwhile, revenues of $2.58 billion beat the Zacks Consensus Estimate of $2.55 billion but declined 17% year over year. However, the top line rose 16% sequentially.
The better-than-expected results can be attributed to strength in automotive, gaming plus OEM and IP end-markets. However, weaknesses in data center market were a spoiler.
Nonetheless, as the company witnessed a sequential progress across all its end-markets, management expects the business to have “normalized”.
Top-Line Details
Revenues at the GPU Business fell 21% year over year to $2.1 billion, reflecting deterioration in the gaming and data center GPUs. However, on a sequential basis, the metric grew 4%.
Tegra Processor Business revenues worth $475 million inched up 2% on a year-over-year basis and 140% sequentially, driven by higher Automotive revenues. However, lower shipments of SOC modules for gaming platforms were a dampener.
On the basis of market platform, Gaming revenues were down 27% on a year-over-year basis to $1.3 billion due to decreased shipments of gaming desktop GPUs and SOC modules for gaming platforms. However, the same was up 24% sequentially, backed by better SOC modules for gaming platforms, gaming notebook GPUs and GeForce RTX SUPER gaming GPUs.
Notably, the launch of Super line of gaming GPUs is making the management optimistic. The rising momentum in the games supporting the ray-tracing feature is a positive.
Meanwhile, revenues from Data Center deteriorated 14% year over year to $655 million as hyperscale customers witnessed soft sales from the segment. However, 3% sequential growth was generated from a rise in enterprise revenues, aided by expanding AI workloads.
Automotive revenues in the reported quarter totaled $209 million, reflecting a 30% year-over-year and a 26% sequential increase. This upside was boosted by autonomous vehicle development deals and the solid uptake of AI-based smart cockpit infotainment solutions. Most importantly, a new development service agreement, mostly with Volvo, has been a key driver.
Moving to Professional Visualization, revenues climbed 4% year over year and 9% sequentially to $291 million. Strength across mobile workstation products is a key catalyst.
OEM and IP revenues dipped 4% year over year to $111 million due to the absence of crypto-currency mining GPU sales. However, the same grew 16% sequentially owing to an uptick in shipments of embedded edge AI products.
NVIDIA Corporation Price, Consensus and EPS Surprise
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