Nvidia Thursday estimate first-quarter revenue that topped Wall Street expectations, boosted by sales of its chips to cloud computing vendors, even as it forecasted a $100 million blow from the coronavirus epidemic.
The forecast bolstered hopes for a rebound in chip demand and sent Nvidia shares up almost 7% in extended trading. In January, Intel and Advanced Micro Units (AMU), Nvidia’s major competitors in selling chips to data center prospects, both forecast positive trends in that industry.
Nvidia is the second chip manufacturer after Qualcomm to warn a few potential impacts on its transactions due to the coronavirus epidemic.
Nvidia’s largest unit is chips that enhance the graphics in video games played on PCs and laptops.
However, in recent times, the business has expanded to sell to data centers and cloud computing clients as its chips increasingly power AI, including facial recognition and speech recognition.
Income from Nvidia’s closely observed data center chips enterprise surged 42.6% to $968 million in its fiscal fourth quarter, beating analysts’ estimate of $829 million, in accordance with analysis firm FactSet.
Nvidia didn’t name big customers; however, it stated that “hyperscale” customers drove the increased data center sales, a group that sector analysts usually define as major cloud computing distributors such as Google, Amazon’s cloud arm and Microsoft.
AI chips for data centers come in two broad sorts: “training” chips that ingest data and prepare a software to hold out tasks like recognizing a face and inference chips that use the trained algorithms to carry out the task.