Chipmaker Nvidia (NVDA) has delivered fourth-quarter 2024 financial results that surpassed Wall Street forecasts across the board, powered by a 78% year-over-year increase in sales.
The Silicon Valley-based company announced earnings per share (EPS) of $0.89, which topped the $0.85 consensus estimate of analysts. Revenue in the period totaled $39.33 billion, which was ahead of the $38.05 billion expected on Wall Street. Global demand for the company’s artificial intelligence (AI) microchips and processors led its sales to increase nearly 80% from a year earlier.
For all of last year, Nvidia’s revenue rose 114% to $130.50 billion. The company, whose chips are widely used in AI data centers, said that it achieved $11 billion in revenue from its newest and most powerful Blackwell chips during the fourth quarter of last year. Nvidia also reported a 73% gross margin for Q4 2024, which was down three percentage points from a year ago.
Blackwell sales, as well as sales of previous generation Hopper AI chips, are reported in Nvidia’s data center business, which comprises 91% of the company’s total revenue. Data center revenue has increased about tenfold in the past two years. Nvidia said that it had $35.60 billion in data center revenue in Q4 2024, up 93% on an annual basis. That was ahead of expectations that called for sales of $33.65 billion.
Forward Guidance
In terms of forward guidance, Nvidia said that it expected about $43 billion of revenue in the current first quarter of 2025, plus or minus 2%. That was ahead of the $41.78 billion expected on Wall Street. In the company’s earnings statement, Nvidia CEO Jensen Huang said that demand for Blackwell microchips remains “amazing.”
If there was a blemish on the company’s results, it was in the gaming segment, which includes graphics processors for video games. That unit reported $2.5 billion in sales for Q4 2024, which fell short of expectations for $3.04 billion. Nvidia’s graphics processor sales declined 11% on an annual basis.
NVDA stock was up 2% in after hours trading on news of its latest financial results. The company’s share price has risen 67% over the last 12 months.
Is NVDA Stock a Buy?
Nvidia’s stock currently has a consensus Strong Buy rating among 35 Wall Street analysts. That rating is based on 33 Buy and two Hold recommendations assigned in the last three months. The average NVDA price target of $177.87 implies 35.49% upside from current levels. These ratings are likely to change after the company’s financial results.
