Nvidia’s (NVDA) stock closed trading day Thursday with goodwill following its impressive third-quarter earnings report on Wednesday. The chip maker’s shares ended with a rise of 8.25% on the day after jumping more than 10% at the opening. The stock’s performance comes after the company reported quarterly revenue growth of 50% year-on-year based on strong results from its data center and gaming companies in Q3.
Nvidia’s data center arm has been a boon for the company and has helped boost the stock price by 124% year-over-year with the stock market closing on Wednesday. And the company’s earnings report only strengthened investor confidence in the business, which had a record revenue of $ 2.94 billion in the previous quarter, a 55% year-over-year increase.
Not to be outdone, Nvidia’s gaming business also brought in record revenue of $ 3.22 billion, a 42% year-over-year increase.
The earnings report comes just a week after Nvidia CEO Jensen Huang hosted the company’s GTC 2021 conference, where it debuted with new hardware and software related to its metaverse platform, called Omniverse, its self-driving vehicle initiatives and its artificial intelligence work.
But Nvidia, like other chip manufacturers, has also been hit by the chip shortage. The company’s graphics cards for consumers are incredibly sparse thanks to a run on them by both cryptocurrencies and merchants who use bots to grab as many cards as possible.
As a result, the cards sell for hundreds of dollars above the manufacturer’s suggested retail price. Cards that should cost $ 599 go to a good distance north of $ 1,000, and it’s a pointless endeavor to find someone near their original prices. Nor can Nvidia see the benefits of the high prices.
Nvidia still makes most of its money on its gaming business, but the company’s data center arm has become increasingly important for the company’s future. The company is a leader in large-scale artificial intelligence systems thanks to the power of its card processing parallel processing, and it will roll out its own CPU to ensure that its data centers do not have to use competitors’ processors.
But not everything is going well for Nvidia. The company’s $ 40 billion plan to buy chip designer ARM has hit a regulatory wall in the UK, where it is undergoing an in-depth review. It must also go through regulators in both the US and China before it is completed.
However, Huang told Yahoo Finance Live that the company is ready to move forward with or without ARM – and that it will continue to succeed, regardless of whether the deal goes through.
It seems that investors also have a similar degree of faith in the company.
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