NVIDIA Posts Record Revenue of $2.17 Billion For Q4 FY2017 – Revenue For Full Fiscal Year 2017 Up By 38%, Up at $6.91 Billion

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Feb 10, 2017
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NVIDIA (NASDAQ:NVDA 190.84 -1.96%) has reported their financial result for the fourth quarter of the fiscal year 2017, and once again posted a record revenue of $2.1 Billion. NVIDIA has posted a stellar growth in the financial results that come from new and strong product lines that have launched during FY17. NVIDIA’s overall revenue rose by 55% compared to Fiscal Year 2016 and was up by 8% from the previous quarter. The NVIDIA shares are currently trading at $114.08 (at the time of writing) which is up from mid $80s during the previous quarter.

NVIDIA Posts Q4 2017 Financial Results – Reported Revenue of $2.1 Billion, 55% Increase in Revenue Compared to Q4 FY 2016

During the quarter, NVIDIA’s revenue raised by 8% from the previous quarter and 55% over Q4 FY2016 to $2.17 Billion. NVIDIA’s full-year revenue grew by 38% to $6.91 Billion. NVIDIA’s operating income raised to $733 million (+191%) from the previous quarter while net income increased by 183% to $655 million. This marks a stellar increase in NVIDIA’s financials during the Fiscal Year of 2017.

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Highlights for Nvidia Corporation (NASDAQ:NVDA 190.84 -1.96%)

  • Record quarterly revenue of $2.17 billion, up 55 percent from a year ago
  • Record full-year revenue of $6.91 billion, up 38 percent from a year ago
  • Record quarterly GAAP gross margin at 60.0 percent, non-GAAP gross margin at 60.2 percent
  • GPU computing platform continues to power gains across full product line

During the quarter, NVIDIA’s GPU business increased by 9% (Q/Q) and 57% (Y/Y) to $1.85 Billion. The Tegra market also saw a boom with an increase of 7% (Q/Q) and 64% (Y/Y) to $257 million in terms of revenue. For entire FY17 comparison with FY16, we are looking at growth of 39% in the GPU business and 47% increase in Tegra business.

Capital Return

During fiscal 2017, NVIDIA paid $739 million in share repurchases and $261 million in cash dividends. As a result, the company returned an aggregate of $1.00 billion to shareholders in fiscal 2017.

For fiscal 2018, NVIDIA intends to return $1.25 billion to shareholders through ongoing quarterly cash dividends and share repurchases.

NVIDIA will pay its next quarterly cash dividend of $0.14 per share on March 17, 2017, to all shareholders of record on February 24, 2017.

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Here are our selected, material segment highlights for the quarter:

Gaming:

  • Introduced GeForce® GTX 1050 and 1050 Ti mobile GPUs, which debuted in more than 30 gaming laptops at CES 2017.
  • Launched the new SHIELD™ TV, integrating Google Assistant for TV, SmartThings Hub technology and the NVIDIA SPOT™ AI mic.
  • Unveiled the GeForce NOW™ service, delivering an NVIDIA Pascal™ gaming PC, on demand, from the cloud to all computers.

Professional Visualization:

  • Launched NVIDIA’s new workstation-product lineup with Quadro® GP100, enabling a new class of supercomputing workstations.
  • Introduced Quadro P5000, powering the first VR-ready mobile workstations from Dell and MSI.

Datacenter:

  • Collaborated with Microsoft to accelerate AI with a GPU-accelerated Microsoft Cognitive Toolkit available on the Microsoft Azure cloud and NVIDIA DGX-1™.
  • Partnered with the National Cancer Institute and the U.S. Department of Energy to build CANDLE, an AI framework that will advance cancer research.
  • Unveiled the NVIDIA DGX SATURNV AI supercomputer, powered by 124 Pascal-powered DGX-1 server nodes, which is the world’s most efficient supercomputer.

Automotive:

  • Partnered with Audi, to put advanced AI cars on the road by 2020.
  • Partnered with Mercedes-Benz, to bring an NVIDIA AI-powered car to the market.
  • Partnered with Bosch, the world’s largest automotive supplier, to bring self-driving systems to production vehicles
  • Partnered with Germany’s ZF, to create a self-driving system for cars, trucks and commercial vehicles based on the NVIDIA DRIVE™ PX 2 AI car computer.
  • Partnered with Europe’s HERE, to develop HERE HD Live Map into a real-time, high-definition mapping solution for autonomous vehicles.
  • Partnered with Japan’s ZENRIN, to develop a cloud-to-car HD map solution for self-driving cars.

NVIDIA Quarterly Platform Trend:

NVIDIA Q4 2017 FY Financial Results

Market specific trends for NVIDIA remained in the positive with gaming segment bringing the bulk of revenue. The gaming market reported a revenue of $1.348 Billion. NVIDIA’s professional visualization market increased to $225 million ($207 million in the previous quarter), datacenter increased to $296 million ($240 million in the previous quarter), auto market increased to $128 million ($127 million in the previous quarter) while OEM and the IP market saw a revenue of $176 million ($186 million in the previous quarter).

GeForce Gaming – The Top Revenue Stream of NVIDIA’s GPU Business

NVIDIA’s superb performance has to do with a strong product line that carters users in all market segments. For gaming, NVIDIA launched their GeForce GTX 1050 Ti and GeForce GTX 1050 products in the mobility market while a strong Pascal GPU powered lineup continues to drive their sales in the GeForce segment. The company still has the fastest high-end gaming GPUs available for consumers such as the GeForce GTX 1080 and GeForce GTX Titan X (Pascal) which continue to be popular among gamers and enthusiasts.

The GeForce GTX 1070 and GeForce GTX 1060 are reaching the same tier as their Maxwell based GTX 970 and GTX 960 predecessors which are the most widely used DirectX 12 graphics products on the Steam hardware database.

The competitive pricing and wide availability of these products have allowed gamers to experience high-fidelity graphics in many AAA and VR titles. NVIDIA has also launched a new GeForce bundle with their GeForce GTX 1080 and GTX 1070 cards which allows users to redeem a game of choice from the upcoming AAA blockbusters such as For Honor and Ghost Recon: Wildlands.

NVIDIA’s high-end cards have seen no threat from their competitors which means that users who want to get high-performance gaming have only one brand in their sights to select from since the competition is still months away from offering a GTX 1080 competitor. NVIDIA also has not launched a full GP102 enabled variant which could slip its way in the lineup, offering even faster performance than their current flagship graphics cards once they see the heat developing in the high-end gaming sector.

Workstation and Datacenter Market Traction Shows GPU Accelerated AI Research A Key Growth Area

The workstation and datacenter markets recently saw a range of new software and hardware products from NVIDIA. Most notably, the recently launched Quadro cards, which aim at advancing AI specific tasks for work station class users. Pascal GP100 GPU proved to be a key milestone for NVIDIA in boosting AI-specific research and their hard work seems to have paid off with impressive FY17 figures.

Datacenter revenue is up 145% from FY16 which is an astonishing jump. We can expect this to remain the trend until competitors have their own products available in the market which won’t be until mid of 2017.

Quarterly Results (NASDAQ:NVDA 190.84 -1.96%) Q4 2017:

NVIDIA Q4 2017 Financial Results

WCCFTech GAAP     
( $ in millions except earnings per share)Q4 FY17Q3 FY17Q4 FY16Q/QY/Y
Revenue (in millions USD)$2173$2004$1401+8%+55%
Gross Margin60.0%59.0%56.5%+1.0%+3.5%
Operating Income (in millions USD)$733$639$252+15%+191%
Net Income$655$542$207+21%+183%
EPS$0.99$0.83$0.35+19%+183%

NVIDIA Market Segment Revenue Results

WCCFTECH     
($ in millions)Q4 FY17Q3 FY17Q4 FY16 Q/Q Y/Y
GPU$1,850$1,697 $1,178 Up 9%Up 57%
Tegra$257$241$157Up 7%Up 64%
Other$66$66------
Total$2,173$2,004 $1,401Up 8%Up 55%

First Quarter of Fiscal 2018 Outlook (NASDAQ:NVDA 190.84 -1.96%)

NVIDIA’s outlook for the first quarter of fiscal 2018 is as follows:

  • Revenue is expected to be $1.90 billion, plus or minus two percent.
  • GAAP and non-GAAP gross margins are expected to be 59.5 percent and 59.7 percent, respectively, plus or minus 50 basis points.
  • GAAP operating expenses are expected to be approximately $603 million. Non-GAAP operating expenses are expected to be approximately $520 million.
  • GAAP other income and expense, net, is expected to be an expense of approximately $20 million, inclusive of additional charges from early conversions of convertible notes. Non-GAAP other income and expense, net, is expected to be an expense of approximately $4 million.
  • GAAP and non-GAAP tax rates for the first quarter of fiscal 2018 are both expected to be 17 percent, plus or minus one percent, excluding any discrete items.
  • Weighted average shares used in the GAAP and non-GAAP diluted EPS calculations are dependent on the weighted average stock price during the quarter.
  • Capital expenditures are expected to be approximately $50 million to $60 million.
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