This afternoon NVIDIA announced their earnings for the second quarter of their 2019 fiscal year. As has been the trend over the last couple of years, NVIDIA continues to churn out the money, with record revenue across all of their platforms this quarter. Revenue was $3.12 billion for the quarter, up 40% from the same quarter a year ago. Margins for the quarter were 63.3%, up 4.9% from Q2 2018. Operating income was up 68% year-over-year to $1.157 billion, and net income was up 89% to $1.101 billion. This meant earnings per share of $1.76, up 91% from a year ago. Although it may sound like Q2 2018 was a poor quarter for NVIDIA with these kinds of gains for 2019, revenue was up 56% year-over-year back in Q2 2018.
| NVIDIA Q2 2019 Financial Results (GAAP) | |||||
| Q2'2019 | Q1'2018 | Q2'2018 | Q/Q | Y/Y | |
| Revenue | $3123M | $3207M | $2230M | -3% | +40% |
| Gross Margin | 63.3% | 64.5% | 58.4% | -1.2% | +4.9% |
| Operating Income | $1157M | $1295M | $688M | -11% | +68% |
| Net Income | $1101M | $1244M | $583M | -11% | +89% |
| EPS | $1.98 | $1.98 | $0.92 | -11% | +91% |
Gaming continues to be the bread and butter for the company, even as they have diversified into other markets. For Q2 2019, gaming revenues were $1.805 billion, which is 52.2% growth over Q2 2018. That’s strong growth despite the drop in cryptocurrency demand for the consumer GeForce cards.
Professional Visualization was up 19.6% in revenue to $281 million. It’ll be interesting to watch this market now that NVIDIA has just announced their Quadro RTX lineup just a few days ago.
The Datacenter market continues to be a source of strong growth as well, with this segment up 83% year-over-year to $760 million in revenue. The company has been creating and expanding markets for their datacenter products, and have found a lot of homes in some very big infrastructures.
Automotive was also up, but at only 13% to $161 million. Growth in this segment isn’t quite as rapid as some of their other inroads, but it’s a strong market that they’ve notched into with Tegra several years ago. NVIDIA now offers several platforms such as DRIVE for vehicle infotainment and driverless cars.
The only real downside for the company is that it seems their OEM orders for cryptocurrency have dried up. They had forecast $100 million in revenue for the quarter for cryptocurrency chips, but delivered only $18 million, and project no meaningful contributions going forward. That’s good news for those of us who have been unable to buy a GPU over the last while, and unsurprising with the rapid decline in cryptocurrency prices.
Looking ahead to next quarter, NVIDIA is expecting revenue of $3.25 billion, plus or minus 2%, with margins of 62.6% plus or minus 0.5%.
| NVIDIA Quarterly Revenue Comparison (GAAP) ($ in millions) |
|||||
| In millions | Q2'2019 | Q1'2018 | Q2'2018 | Q/Q | Y/Y |
| Gaming | $1805 | $1723 | $1027 | +4.8% | +75.7% |
| Professional Visualization | $281 | $251 | $205 | +11.9% | +37.1% |
| Datacenter | $760 | $701 | $409 | +8.4% | +85.8% |
| Automotive | $161 | $145 | $140 | +11.0% | +15% |
| OEM & IP | $116 | $387 | $156 | -70.0% | -25.6% |
Source: NVIDIA Investor Relations
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