Luxurious problems

19 November 2020 By Robert Cyran Follow @rob_cyran

The $326 bln firm is riding a wave of demand for gaming and data center chips. But its own suppliers are struggling to keep pace, which crimps its current potential while putting future sales at risk. Nvidia’s future is bright, but there are limits to how much it can shine.

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Nvidia said on Nov. 18 third-quarter revenue was $4.7 billion, an increase of 57% from the same period last year. The semiconductor firm said revenue from gaming chips rose 37% to $2.3 billion, while data center revenue rose 162% to $1.9 billion. Nvidia earned $1.3 billion, or $2.12 per share in the quarter, compared to $899 million, or $1.45 a share in the same period a year ago.

The company’s chief financial officer said in a call with investors that data center revenue would fall slightly in the fourth quarter as unusually large sales to a Chinese firm would not repeat in the current quarter.

Nvidia’s shares fell slightly in early morning trading on Nov. 19. The company’s stock has more than doubled over the past 12 months.

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