Nvidia beats Q2 expectations, achieves record automotive sales

Revenue and earnings were down year-over-year, but Nvidia achieved sequential growth across platforms with especially strong growth in Automotive.
Written by Stephanie Condon, Senior Writer

Nvidia published its second-quarter fiscal 2020 results on Thursday, beating market expectations. Shares were up in after-hours trading. 

Non-GAAP earnings per diluted share were $1.24, compared with $1.94 a year earlier. Revenue came to $2.58 billion compared with $3.12 billion a year earlier 

Wall Street was looking for earnings of $1.14 on revenue of $2.54 billion. 

While performance was down on a year-over-year basis, founder and CEO Jensen Huang noted that the GPU maker achieved sequential growth across platforms. In a statement, he cited areas of growth and innovation for Nvidia. 

"Real-time ray tracing is the most important graphics innovation in a decade. Adoption has reached a tipping point, with Nvidia RTX leading the way," he said.  "Nvidia accelerated computing momentum continues to build as the industry races to enable the next frontier in artificial intelligence, conversational AI, as well as autonomous systems like self-driving vehicles and delivery robots." 


In Q2, gaming revenue was $1.31 billion, down 27 percent from a year ago and up 24 percent sequentially. The year-over-year decrease reflects a decline in shipments of gaming desktop GPUs and SOC modules for gaming platforms, Nvidia said. This was partially offset by growth in gaming notebook GPUs. The sequential increase reflects growth from SOC modules for gaming platforms, gaming notebook GPUs, and GeForce RTX SUPER gaming GPUs. 

Professional Visualization revenue in Q2 was $291 million, up 4 percent from a year earlier and up 9 percent sequentially. The year-over-year and sequential growth reflects strength across mobile workstation products. 

Data Center revenue was $655 million, down 14 percent from a year ago and up 3 percent sequentially. The year-over-year decline reflects lower hyper scale revenue. The sequential increase was due to enterprise revenue growth driven by expanding AI workloads. 

Automotive revenue was a record $209 million, up 30 percent from a year earlier and up 26 percent sequentially. The year-over-year and sequential growth was primarily driven by a development services agreement in the second quarter of fiscal 2020. The growth in revenue also reflected AI cockpit solutions and other autonomous vehicle development agreements. 

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OEM and Other revenue was $111 million, down 4 percent from a year ago and up 12 percent sequentially. The sequential increase was primarily due to growth in shipments of embedded edge AI products.   

Nvidia will pay its next quarterly cash dividend of 16 cents per share on September 20 and will return to repurchasing its stock after the close of the Mellanox acquisition. The deal is progressing as expected, and Nvidia still expects to close the deal by the end of this calendar year.

For the third quarter, Nvidia expects revenue of $2.90 billion, plus or minus 2 percent.

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