Outlook
NVIDIA’s outlook for the third quarter of fiscal 2025 is as follows:
- Revenue is expected to be $32.5 billion, plus or minus 2%.
- GAAP and non-GAAP gross margins are expected to be 74.4% and 75.0%, respectively, plus or minus 50 basis points. For the full year, gross margins are expected to be in the mid-70% range.
- GAAP and non-GAAP operating expenses are expected to be approximately $4.3 billion and $3.0 billion, respectively. Full-year operating expenses are expected to grow in the mid- to upper-40% range.
- GAAP and non-GAAP other income and expense are expected to be an income of approximately $350 million, excluding gains and losses from non-affiliated investments and publicly-held equity securities.
- GAAP and non-GAAP tax rates are expected to be 17%, plus or minus 1%, excluding any discrete items.
Highlights
NVIDIA achieved progress since its previous earnings announcement in these areas:
Data Center
- Second-quarter revenue was a record $26.3 billion, up 16% from the previous quarter and up 154% from a year ago.
- Announced that the combination of NVIDIA H200 Tensor Core and NVIDIA Blackwell architecture B200 Tensor Core processors swept the latest industry-standard MLPerf benchmark results for inference.
- Revealed that H200 GPU-powered systems are now available on CoreWeave, the first cloud service provider to announce general availability.
- Unveiled an array of Blackwell systems featuring NVIDIA Grace™ CPUs, networking and infrastructure from top manufacturers such as GIGABYTE, QCT and Wiwynn.
- Reported broad adoption of the NVIDIA Spectrum-X™ Ethernet networking platform by cloud service providers, GPU cloud providers and enterprises, as well as partners incorporating it into their offerings.
- Released NVIDIA NIM™ for broad availability to developers globally and announced more than 150 companies are integrating microservices into their platforms to speed generative AI application development.
- Unveiled an inference service with Hugging Face powered by NIM microservices on NVIDIA DGX™ Cloud to enable developers to deploy popular large language models.
- Introduced an NVIDIA AI Foundry service and NIM inference microservices to accelerate generative AI for the world’s enterprises with the Llama 3.1 collection of models.
- Announced Japan advanced its sovereign AI capabilities with its ABCI 3.0 supercomputer, integrating H200 GPUs and NVIDIA Quantum-2 InfiniBand networking.
- Accelerated quantum computing efforts at national supercomputing centers around the world with the open-source NVIDIA CUDA-Q™ platform.
Gaming and AI PC
- Second-quarter Gaming revenue was $2.9 billion, up 9% from the previous quarter and up 16% from a year ago.
- Announced NVIDIA ACE, a suite of generative AI technologies that bring digital humans to life, now includes NVIDIA Nemotron-4 4B, a small language model for on-device inference, and is available in early access for RTX AI PCs.
- Introduced Project G-Assist, a technology preview demonstrating the power of AI agents to assist gamers and creators in real time.
- Announced new NVIDIA GeForce RTX and DLSS titles, including Indiana Jones and the Great Circle, Dune: Awakening and Dragon Age: The Veilguard, bringing the total number of RTX games and apps to over 600.
- Surpassed 2,000 games on
GeForce NOW, expanded the service into Japan and announced launches of Black Myth: Wukong and Star Wars Outlaws.
Professional Visualization
- Second-quarter revenue was $454 million, up 6% from the previous quarter and up 20% from a year ago.
- Introduced generative AI models and NIM microservices for OpenUSD to accelerate workflows and the development of industrial digital twins and robotics.
- Announced major
Taiwanese electronics makers are creating more autonomous factories with a new reference workflow that combines NVIDIA Metropolis vision AI, NVIDIA Omniverse™ simulation and NVIDIA Isaac™ AI robot development.
Automotive and Robotics
- Second-quarter Automotive revenue was $346 million, up 5% from the previous quarter and up 37% from a year ago.
- Unveiled the world’s leaders in robot development, including BYD Electronics, Siemens and Teradyne Robotics, are adopting the Isaac robotics platform for R&D and production.
- Announced Omniverse Cloud Sensor RTX™ microservices to enable physically accurate sensor simulation to speed development of autonomous machines.
- Won the Autonomous Grand Challenge at the Computer Vision and Pattern Recognition conference in the category of End-to-End Driving at Scale for advances in building physical, generative AI applications for autonomous vehicle development.
CFO Commentary
Commentary on the quarter by Colette Kress, NVIDIA’s executive vice president and chief financial officer, is available at
https://investor.nvidia.com.
Conference Call and Webcast Information
NVIDIA will conduct a conference call with analysts and investors to discuss its second quarter fiscal 2025 financial results and current financial prospects today at 2 p.m. Pacific time (5 p.m. Eastern time). A live webcast (listen-only mode) of the conference call will be accessible at NVIDIA’s investor relations website,
https://investor.nvidia.com. The webcast will be recorded and available for replay until NVIDIA’s conference call to discuss its financial results for its third quarter of fiscal 2025.
Non-GAAP Measures
To supplement NVIDIA’s condensed consolidated financial statements presented in accordance with GAAP, the company uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP income from operations, non-GAAP other income (expense), net, non-GAAP net income, non-GAAP net income, or earnings, per diluted share, and free cash flow. For NVIDIA’s investors to be better able to compare its current results with those of previous periods, the company has shown a reconciliation of GAAP to non-GAAP financial measures. These reconciliations adjust the related GAAP financial measures to exclude stock-based compensation expense, acquisition-related and other costs, other, gains from non-affiliated investments and publicly-held equity securities, net, interest expense related to amortization of debt discount, and the associated tax impact of these items where applicable. Free cash flow is calculated as GAAP net cash provided by operating activities less both purchases related to property and equipment and intangible assets and principal payments on property and equipment and intangible assets. NVIDIA believes the presentation of its non-GAAP financial measures enhances the user’s overall understanding of the company’s historical financial performance. The presentation of the company’s non-GAAP financial measures is not meant to be considered in isolation or as a substitute for the company’s financial results prepared in accordance with GAAP, and the company’s non-GAAP measures may be different from non-GAAP measures used by other companies.
| NVIDIA CORPORATION | ||||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||
| (In millions, except per share data) | ||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||
| July 28, | July 30, | July 28, | July 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||||
| Revenue | $ | 30,040 | $ | 13,507 | $ | 56,084 | $ | 20,699 | ||||||||||
| Cost of revenue | 7,466 | 4,045 | 13,105 | 6,589 | ||||||||||||||
| Gross profit | 22,574 | 9,462 | 42,979 | 14,110 | ||||||||||||||
| Operating expenses | ||||||||||||||||||
| Research and development | 3,090 | 2,040 | 5,810 | 3,916 | ||||||||||||||
| Sales, general and administrative | 842 | 622 | 1,618 | 1,253 | ||||||||||||||
| Total operating expenses | 3,932 | 2,662 | 7,428 | 5,169 | ||||||||||||||
| Operating Income | 18,642 | 6,800 | 35,551 | 8,941 | ||||||||||||||
| Interest income | 444 | 187 | 803 | 338 | ||||||||||||||
| Interest expense | (61 | ) | (65 | ) | (125 | ) | (131 | ) | ||||||||||
| Other, net | 189 | 59 | 264 | 42 | ||||||||||||||
| Other income (expense), net | 572 | 181 | 942 | 249 | ||||||||||||||
| Income before income tax | 19,214 | 6,981 | 36,493 | 9,190 | ||||||||||||||
| Income tax expense | 2,615 | 793 | 5,013 | 958 | ||||||||||||||
| Net income | $ | 16,599 | $ | 6,188 | $ | 31,480 | $ | 8,232 | ||||||||||
| Net income per share: | ||||||||||||||||||
| Basic | $ | 0.68 | $ | 0.25 | $ | 1.28 | $ | 0.33 | ||||||||||
| Diluted | $ | 0.67 | $ | 0.25 | $ | 1.27 | $ | 0.33 | ||||||||||
| Weighted average shares used in per share computation: | ||||||||||||||||||
| Basic | 24,578 | 24,729 | 24,599 | 24,716 | ||||||||||||||
| Diluted | 24,848 | 24,994 | 24,869 | 24,948 | ||||||||||||||
