Nvidia sales surge due to crypto mining demand

Nvidia Corp. said demand for graphics chips from its main video gaming market, cryptocurrency miners and data-center owners propelled sales higher than projected in the current quarter.

Revenue in the fiscal first quarter will be $2.9 billion, plus or minus 2 percent, the Santa Clara, California-based company said Thursday in a statement. That would top the average analyst estimate of $2.44 billion, according to data compiled by Bloomberg.

Nvidia founder and Chief Executive Officer Jen-Hsun Huang has jumped on trends that are changing computing to find new areas for his graphics chips. The biggest breakthrough has come as data-center operators increasingly use Nvidia products to perform the parallel work of artificial intelligence computing. The company’s gaming business, which generates almost 60 percent of revenue, has been supplemented by the diversion of high-end graphics chip cards into cryptocurrency mining. There’s also a flood of work being done on developing systems that will drive cars, which will provide another bump in demand in the next couple of years, Huang said in an interview.

“One growth driver after another just keeps on coming,” he said. “Maybe that’s the reason why we’re surprising people year in and year out.”

Nvidia has recorded revenue growth of more than 20 percent for the last seven quarters. It’s gone from quarterly sales of less than $1 billion in 2014 to approaching $3 billion.

The company, under its founder, has been ahead of its competitors in taking advantage of the shifts going on in computing. Nvidia, for example, is producing chips specifically designed to make cars self driving by being able to rapidly process camera images and recognize objects in the real world. In data centers, its products help make machines better at recognizing natural speech and other tasks where learning is a key component.

The stock rose more than 11 percent in extended trading following the results, after closing at $217.52 in New York. Nvidia shares are the second-best performer on the Philadelphia Stock Market Semiconductor Index this year with an increase of 12 percent.

Net income rose to $1.12 billion, or $1.78 a share, in the quarter ended Jan. 28, from $655 million, or 99 cents, a year earlier, the company said. Sales jumped 34 percent to $2.91 billion. Analysts on average had projected profit of $1.16 a share on sales of $2.68 billion.

Gaming revenue increased 29 percent to $1.74 billion in the quarter. Data center-related revenue was $606 million. Automotive chip sales were $132 million.

Now read: Nvidia asks retailers to put gamers first, not miners

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Nvidia sales surge due to crypto mining demand