NVIDIA Declares Monetary Outcomes for Second Quarter Fiscal 2023

  • Quarterly income of $6.70 billion, up 3% from a 12 months in the past
  • Knowledge Heart income of $3.81 billion, up 61% from a 12 months in the past
  • Quarterly return to shareholders of $3.44 billion

NVIDIA right this moment reported income for the second quarter ended July 31, 2022, of $6.70 billion, up 3% from a 12 months in the past and down 19% from the earlier quarter.

GAAP earnings per diluted share for the quarter had been $0.26, down 72% from a 12 months in the past and down 59% from the earlier quarter. Non-GAAP earnings per diluted share had been $0.51, down 51% from a 12 months in the past and down 63% from the earlier quarter.

“We’re navigating our provide chain transitions in a difficult macro surroundings and we’ll get by means of this,” mentioned Jensen Huang, founder and CEO of NVIDIA.

“Accelerated computing and AI, the pioneering work of our firm, are reworking industries. Automotive is changing into a tech business and is on monitor to be our subsequent billion-dollar enterprise. Advances in AI are driving our Knowledge Heart enterprise whereas accelerating breakthroughs in fields from drug discovery to local weather science to robotics.

“I sit up for subsequent month’s GTC convention, the place we’ll share new advances in RTX, in addition to breakthroughs in AI and the metaverse, the subsequent evolution of the web. Be a part of us,” he mentioned.

In the course of the second quarter of fiscal 2023, NVIDIA returned to shareholders $3.44 billion in share repurchases and money dividends, following a return of $2.10 billion within the first quarter. The corporate has $11.93 billion remaining underneath its share repurchase authorization by means of December 2023. NVIDIA plans to proceed share repurchases this fiscal 12 months.

NVIDIA pays its subsequent quarterly money dividend of $0.04 per share on September 29, 2022, to all shareholders of report on September 8, 2022.

Q2 Fiscal 2023 Abstract











GAAP
($ in tens of millions, besides earnings per share) Q2 FY23 Q1 FY23 Q2 FY22 Q/Q Y/Y
Income $6,704   $8,288   $6,507   Down 19% Up 3%
Gross margin   43.5%     65.5%     64.8%   Down 22.0 pts Down 21.3 pts
Working bills $2,416   $3,563   $1,771   Down 32% Up 36%
Working earnings $499   $1,868   $2,444   Down 73% Down 80%
Web earnings $656   $1,618   $2,374   Down 59% Down 72%
Diluted earnings per share $0.26   $0.64   $0.94   Down 59% Down 72%

 











Non-GAAP
($ in tens of millions, besides earnings per share) Q2 FY23 Q1 FY23 Q2 FY22 Q/Q Y/Y
Income $6,704   $8,288   $6,507   Down 19% Up 3%
Gross margin   45.9%     67.1%     66.7%   Down 21.2 pts Down 20.8 pts
Working bills $1,749   $1,608   $1,266   Up 9% Up 38%
Working earnings $1,325   $3,955   $3,071   Down 66% Down 57%
Web earnings $1,292   $3,443   $2,623   Down 62% Down 51%
Diluted earnings per share $0.51   $1.36   $1.04   Down 63% Down 51%

Outlook

NVIDIA’s outlook for the third quarter of fiscal 2023 is as follows:

  • Income is predicted to be $5.90 billion, plus or minus 2%. Gaming and Skilled Visualization income are anticipated to say no sequentially, as OEMs and channel companions scale back stock ranges to align with present ranges of demand and put together for NVIDIA’s new product technology. The corporate expects that decline to be partially offset by sequential progress in Knowledge Heart and Automotive.
  • GAAP and non-GAAP gross margins are anticipated to be 62.4% and 65.0%, respectively, plus or minus 50 foundation factors.
  • GAAP and non-GAAP working bills are anticipated to be roughly $2.59 billion and $1.82 billion, respectively.
  • GAAP and non-GAAP different earnings and expense are anticipated to be an expense of roughly $10 million, excluding good points and losses from non-affiliated investments.
  • GAAP and non-GAAP tax charges are anticipated to be 9.5%, plus or minus 1%, excluding any discrete gadgets.

Highlights

NVIDIA achieved progress since its earlier earnings announcement in these areas: 

Knowledge Heart

  • Second-quarter income was $3.81 billion, up 61% from a 12 months in the past and up 1% from the earlier quarter.
  • Introduced that NVIDIA Grace™ superchips are getting used to create HGX™ techniques by a few of the world’s main pc makers — together with Atos, Dell Applied sciences, GIGABYTE, HPE, Inspur, Lenovo and Supermicro.
  • Unveiled QODA™, the NVIDIA Quantum Optimized Gadget Structure, a unified computing platform for rushing breakthroughs in quantum analysis and improvement throughout AI, HPC, well being, finance and different disciplines.
  • Supplied updates for the NeMo™ Megatron giant language mannequin framework that allow coaching speedups of as much as 30%.
  • Expanded NVIDIA Fleet Command™ — a cloud service for deploying, managing and scaling AI functions on the edge — with options that improve the seamless administration of edge AI deployments.
  • Shared that, within the newest MLPerf coaching benchmark submissions, NVIDIA and its companions continued to supply one of the best total AI coaching efficiency and essentially the most submissions throughout all benchmarks. 

Gaming

  • Second-quarter income was $2.04 billion, down 33% from a 12 months in the past and down 44% from the earlier quarter.
  • Added 30 RTX ON video games and apps — together with A Plague Story: Requiem, Evil Lifeless: The Sport and F1 22 — bringing the entire obtainable to 280+. 
  • Elevated the variety of GeForce® RTX™ and NVIDIA Studio™ laptops to a report 180+, together with introduction of the fastest-ever laptops with GeForce RTX 3080 Ti, 2-in-1 convertible gaming laptops and a broad vary of Studio laptops.
  • Expanded the GeForce NOW™ library with 80 further video games — together with Genshin Affect, Evil Lifeless the Sport, Mass Impact Legendary Version and Loopmancer with RTX — bringing the entire to over 1,350.

Skilled Visualization

  • Second-quarter income was $496 million, down 4% from a 12 months in the past and down 20% from the earlier quarter.
  • Expanded its partnership with Siemens to allow the commercial metaverse and enhance use of AI-driven digital twin expertise.
  • Introduced Omniverse™ Avatar Cloud Engine, a set of cloud-native AI fashions and companies that make it simpler to construct and customise lifelike digital assistants and digital people.
  • Launched a broad initiative to evolve Common Scene Description, the open-source and extensible language of 3D worlds, to turn into a basis of the open metaverse.
  • Introduced a significant launch of Omniverse with new frameworks, instruments, apps and plugins, together with 11 new connectors to the Omniverse USD ecosystem that carry the entire to 112.
  • Co-founded the Metaverse Requirements Discussion board to align with different members on one of the best methods to construct the foundations of the metaverse.

Automotive

  • Second-quarter income was $220 million, up 45% from a 12 months in the past and up 59% from the earlier quarter.
  • Introduced rollout plans of latest mannequin autos utilizing the DRIVE Orin™ compute platform by companions NIO, Li Auto, JIDU, and Human Horizons, in addition to Pony.ai’s use of DRIVE Orin throughout its line of self-driving vans and robotaxis.

CFO Commentary

Commentary on the quarter by Colette Kress, NVIDIA’s govt vice chairman and chief monetary officer, is obtainable at https://investor.nvidia.com/.

Convention Name and Webcast Data

NVIDIA will conduct a convention name with analysts and buyers to debate its second quarter fiscal 2023 monetary outcomes and present monetary prospects right this moment at 2 p.m. Pacific time (5 p.m. Japanese time). A stay webcast (listen-only mode) of the convention name might be accessible at NVIDIA’s investor relations web site, https://investor.nvidia.com. The webcast might be recorded and obtainable for replay till NVIDIA’s convention name to debate its monetary outcomes for its third quarter of fiscal 2023.

Non-GAAP Measures

To complement NVIDIA’s condensed consolidated monetary statements introduced in accordance with GAAP, the corporate makes use of non-GAAP measures of sure parts of economic efficiency. These non-GAAP measures embody non-GAAP gross revenue, non-GAAP gross margin, non-GAAP working bills, non-GAAP earnings from operations, non-GAAP different earnings (expense), internet, non-GAAP internet earnings, non-GAAP internet earnings, or earnings, per diluted share, and free money stream. For NVIDIA’s buyers to be higher capable of evaluate its present outcomes with these of earlier durations, the corporate has proven a reconciliation of GAAP to non-GAAP monetary measures. These reconciliations regulate the associated GAAP monetary measures to exclude acquisition termination prices, stock-based compensation expense, acquisition-related and different prices, contributions, IP-related prices, authorized settlement prices, good points and losses from non-affiliated investments, curiosity expense associated to amortization of debt low cost, the related tax affect of these things the place relevant, domestication tax profit, and overseas tax profit. Free money stream is calculated as GAAP internet money offered by working actions much less each purchases of property and gear and intangible belongings and principal funds on property and gear and intangible belongings. NVIDIA believes the presentation of its non-GAAP monetary measures enhances the consumer’s total understanding of the corporate’s historic monetary efficiency. The presentation of the corporate’s non-GAAP monetary measures just isn’t meant to be thought-about in isolation or as an alternative choice to the corporate’s monetary outcomes ready in accordance with GAAP, and the corporate’s non-GAAP measures could also be completely different from non-GAAP measures utilized by different firms.

 






































 
NVIDIA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In tens of millions, besides per share knowledge)
(Unaudited)
                   
                   
      Three Months Ended   Six Months Ended
      July 31,   August 1,   July 31,   August 1,
      2022   2021   2022   2021
                   
Income $ 6,704     $ 6,507     $ 14,992     $ 12,168  
Value of income   3,789       2,292       6,646       4,324  
Gross revenue   2,915       4,215       8,346       7,844  
Working bills              
  Analysis and improvement   1,824       1,245       3,443       2,398  
  Gross sales, normal and administrative   592       526       1,183       1,046  
  Acquisition termination value               1,353        
    Complete working bills   2,416       1,771       5,979       3,444  
Earnings from operations   499       2,444       2,367       4,400  
  Curiosity earnings   46       6       64       13  
  Curiosity expense   (65 )     (60 )     (132 )     (113 )
  Different, internet   (5 )     4       (19 )     138  
    Different earnings (expense), internet   (24 )     (50 )     (87 )     38  
Earnings earlier than earnings tax   475       2,394       2,280       4,438  
Earnings tax expense (profit)   (181 )     20       6       153  
Web earnings $ 656     $ 2,374     $ 2,274     $ 4,285  
                   
Web earnings per share:              
  Fundamental $ 0.26     $ 0.95     $ 0.91     $ 1.72  
  Diluted $ 0.26     $ 0.94     $ 0.90     $ 1.69  
                   
Weighted common shares utilized in per share computation:            
  Fundamental   2,495       2,493       2,500       2,489  
  Diluted   2,516       2,532       2,526       2,529  

 












































 
NVIDIA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In tens of millions)
(Unaudited)
             
             
        July 31,   January 30,
        2022   2022
ASSETS        
             
Present belongings:        
  Money, money equivalents and marketable securities   $ 17,037   $ 21,208
  Accounts receivable, internet     5,317     4,650
  Inventories     3,889     2,605
  Pay as you go bills and different present belongings     1,175     366
    Complete present belongings     27,418     28,829
             
Property and gear, internet     3,233     2,778
Working lease belongings     852     829
Goodwill     4,372     4,349
Intangible belongings, internet     2,036     2,339
Deferred earnings tax belongings     2,225     1,222
Different belongings     3,340     3,841
    Complete belongings   $ 43,476   $ 44,187
             
LIABILITIES AND SHAREHOLDERS’ EQUITY
             
Present liabilities:        
  Accounts payable   $ 2,421   $ 1,783
  Accrued and different present liabilities     3,903     2,552
  Quick-term debt     1,249    
    Complete present liabilities     7,573     4,335
             
Lengthy-term debt     9,700     10,946
Lengthy-term working lease liabilities     743     741
Different long-term liabilities     1,609     1,553
    Complete liabilities     19,625     17,575
             
Shareholders’ fairness     23,851     26,612
    Complete liabilities and shareholders’ fairness   $ 43,476   $ 44,187

 




















































 
NVIDIA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In tens of millions)
(Unaudited)
                 
                 
    Three Months Ended   Six Months Ended
    July 31,   August 1,   July 31,   August 1,
    2022   2021   2022   2021
                 
Money flows from working actions:              
Web earnings $ 656     $ 2,374     $ 2,274     $ 4,285  
Changes to reconcile internet earnings to internet money              
offered by working actions:              
  Inventory-based compensation expense   648       465       1,226       894  
  Depreciation and amortization   378       286       712       567  
  Losses (good points) on investments in non associates, internet   7       1       24       (133 )
  Deferred earnings taxes   (443 )     (185 )     (985 )     (161 )
  Acquisition termination value               1,353        
  Different   (5 )     18       18       16  
Adjustments in working belongings and liabilities, internet of acquisitions:              
  Accounts receivable   120       (563 )     (668 )     (1,157 )
  Inventories   (725 )     (123 )     (1,285 )     (282 )
  Pay as you go bills and different belongings   (293 )     16       (1,554 )     18  
  Accounts payable   304       209       559       245  
  Accrued and different present liabilities   633       133       1,267       166  
  Different long-term liabilities   (10 )     51       60       98  
Web money offered by working actions   1,270       2,682       3,001       4,556  
Money flows from investing actions:              
  Proceeds from maturities of marketable securities   5,036       2,096       10,983       5,236  
  Proceeds from gross sales of marketable securities   702       347       1,731       705  
  Purchases of marketable securities   (3,644 )     (4,798 )     (7,576 )     (9,268 )
  Purchases associated to property and gear and intangible belongings   (433 )     (183 )     (794 )     (481 )
  Acquisitions, internet of money acquired   (13 )           (49 )      
  Investments and different, internet   (30 )     5       (65 )     3  
Web money offered by (utilized in) investing actions   1,618       (2,533 )     4,230       (3,805 )
Money flows from financing actions:              
  Proceeds associated to worker inventory plans   1       2       205       128  
  Funds associated to repurchases of frequent inventory   (3,345 )           (5,341 )      
  Funds associated to tax on restricted inventory models   (305 )     (365 )     (837 )     (843 )
  Dividends paid   (100 )     (100 )     (200 )     (198 )
  Principal funds on property and gear and intangible belongings   (14 )     (21 )     (36 )     (40 )
  Issuance of debt, internet of issuance prices         4,985             4,985  
  Different   1             1       (2 )
Web money offered by (utilized in) financing actions   (3,762 )     4,501       (6,208 )     4,030  
Change in money and money equivalents   (874 )     4,650       1,023       4,781  
Money and money equivalents at starting of interval   3,887       978       1,990       847  
Money and money equivalents at finish of interval $ 3,013     $ 5,628     $ 3,013     $ 5,628  

 









































































 
NVIDIA CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In tens of millions, besides per share knowledge)
(Unaudited)
                      
         Three Months Ended   Six Months Ended
         July 31,   Might 1,   August 1,   July 31,   August 1,
         2022   2022   2021   2022   2021
                          
GAAP gross revenue $ 2,915     $ 5,431     $ 4,215     $ 8,346     $ 7,844  
  GAAP gross margin     43.5 %     65.5 %     64.8 %     55.7 %     64.5 %
    Acquisition-related and different prices (A)   121       94       86       214       173  
    Inventory-based compensation expense (B)   38       38       32       76       57  
    IP-related prices                  4             9  
Non-GAAP gross revenue $ 3,074     $ 5,563     $ 4,337     $ 8,636     $ 8,083  
  Non-GAAP gross margin     45.9 %     67.1 %     66.7 %     57.6 %     66.4 %
                          
GAAP working bills $ 2,416     $ 3,563     $ 1,771     $ 5,979     $ 3,444  
    Inventory-based compensation expense (B)   (611 )     (540 )     (433 )     (1,151 )     (837 )
    Acquisition-related and different prices (A)   (54 )     (55 )     (72 )     (110 )     (152 )
    Contributions      (2 )                 (2 )      
    Acquisition termination value         (1,353 )           (1,353 )      
    Authorized settlement prices         (7 )           (7 )      
Non-GAAP working bills $ 1,749     $ 1,608     $ 1,266     $ 3,356     $ 2,455  
                          
GAAP earnings from operations $ 499     $ 1,868     $ 2,444     $ 2,367     $ 4,400  
    Complete affect of non-GAAP changes to earnings from operations   826       2,087       627       2,913       1,228  
Non-GAAP earnings from operations $ 1,325     $ 3,955     $ 3,071     $ 5,280     $ 5,628  
                          
GAAP different earnings (expense), internet $ (24 )   $ (63 )   $ (50 )   $ (87 )   $ 38  
    (Positive factors) losses from non-affiliated investments   7       17             24       (133 )
    Curiosity expense associated to amortization of debt low cost   1       1       1       2       2  
Non-GAAP different earnings (expense), internet $ (16 )   $ (45 )   $ (49 )   $ (61 )   $ (93 )
                          
GAAP internet earnings   $ 656     $ 1,618     $ 2,374     $ 2,274     $ 4,285  
    Complete pre-tax affect of non-GAAP changes   833       2,105       628       2,940       1,097  
    Earnings tax affect of non-GAAP changes (C)   (197 )     (280 )     (127 )     (478 )     (194 )
    Domestication tax changes               (252 )           (252 )
Non-GAAP internet earnings $ 1,292     $ 3,443     $ 2,623     $ 4,736     $ 4,936  
                          
Diluted internet earnings per share                  
    GAAP    $ 0.26     $ 0.64     $ 0.94     $ 0.90     $ 1.69  
    Non-GAAP    $ 0.51     $ 1.36     $ 1.04     $ 1.87     $ 1.95  
                          
Weighted common shares utilized in diluted internet earnings per share computation   2,516       2,537       2,532       2,527       2,529  
                          
GAAP internet money offered by working actions $ 1,271     $ 1,731     $ 2,682     $ 3,001     $ 4,556  
    Purchases associated to property and gear and intangible belongings   (432 )     (361 )     (183 )     (794 )     (481 )
    Principal funds on property and gear   (15 )     (22 )     (21 )     (36 )     (40 )
Free money stream   $ 824     $ 1,348     $ 2,478     $ 2,171     $ 4,035  
                          
                          
(A) Acquisition-related and different prices are comprised of amortization of intangible belongings, transaction prices and sure compensation expenses introduced within the following line gadgets:
         Three Months Ended   Six Months Ended
         July 31,   Might 1,   August 1,   July 31,   August 1,
         2022   2022   2021   2022   2021
    Value of income $ 121     $ 94     $ 86     $ 214     $ 173  
    Analysis and improvement $ 10     $ 9     $ 1     $ 19     $ 4  
    Gross sales, normal and administrative $ 44     $ 46     $ 71     $ 91     $ 148  
                          
(B) Inventory-based compensation consists of the next:      
         Three Months Ended   Six Months Ended
         July 31,   Might 1,   August 1,   July 31,   August 1,
         2022   2022   2021   2022   2021
    Value of income $ 38     $ 38     $ 32     $ 76     $ 57  
    Analysis and improvement $ 452     $ 384     $ 297     $ 836     $ 573  
    Gross sales, normal and administrative $ 159     $ 156     $ 136     $ 315     $ 264  
 
(C) Earnings tax affect of non-GAAP changes, together with the popularity of extra tax advantages or deficiencies associated to stock-based compensation underneath GAAP accounting normal (ASU 2016-09).      

 



















   
NVIDIA CORPORATION  
RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK  
       
   
    Q3 FY2023 Outlook  
    ($ in tens of millions)  
       
GAAP gross margin   62.4 %  
  Affect of stock-based compensation expense, acquisition-related prices, and different prices   2.6 %  
Non-GAAP gross margin   65.0 %  
       
GAAP working bills $ 2,590    
  Inventory-based compensation expense and acquisition-related prices   (770 )  
Non-GAAP working bills $ 1,820    
       


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