NVIDIA Corp (NVDA) Q4 2025 Earnings Call Highlights: Record Revenue and Data Center Growth Amid ...

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27-02-2025

Revenue: $39.3 billion for Q4, up 12% sequentially and 78% year on year; fiscal 2025 revenue was $130.5 billion, up 114% from the prior year.
Data Center Revenue: $35.6 billion for Q4, up 16% sequentially and 93% year on year; fiscal 2025 data center revenue was $115.2 billion, more than doubling from the prior year.
Gaming Revenue: $2.5 billion for Q4, decreased 22% sequentially and 11% year on year; full-year revenue was $11.4 billion, up 9% year on year.
Professional Visualization Revenue: $511 million for Q4, up 5% sequentially and 10% year on year; full-year revenue was $1.9 billion, up 21% year on year.
Automotive Revenue: $570 million for Q4, up 27% sequentially and 103% year on year; full-year revenue was $1.7 billion, up 55% year on year.
Gross Margins: GAAP gross margin was 73%, and non-GAAP gross margin was 73.5% for Q4.
Operating Expenses: GAAP operating expenses up 9% sequentially; non-GAAP operating expenses up 11% sequentially.
Shareholder Returns: $8.1 billion returned to shareholders in Q4 through share repurchases and cash dividends.
Q1 Outlook: Expected revenue of $43 billion, plus or minus 2%; GAAP and non-GAAP gross margins expected to be 70.6% and 71%, respectively.
Warning! GuruFocus has detected 3 Warning Signs with NVDA.
Release Date: February 26, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
NVIDIA Corp (NASDAQ:NVDA) reported a record revenue of $39.3 billion for Q4, up 12% sequentially and 78% year-on-year, surpassing their outlook.
Data center revenue for fiscal 2025 was $115.2 billion, more than doubling from the prior year, driven by strong demand for Blackwell and Hopper 200 products.
The Blackwell product ramp is the fastest in the company's history, with $11 billion in revenue generated in Q4 alone.
NVIDIA's inference demand is accelerating, with Blackwell offering up to 25x higher token throughput and 20x lower cost compared to previous models.
Enterprise revenue increased nearly 2x year-on-year, driven by demand for model fine-tuning and AI workflows.
Networking revenue declined 3% sequentially, although it is expected to return to growth in Q1.
Gaming revenue decreased 22% sequentially and 11% year-on-year, impacted by supply constraints.
GAAP gross margins were down sequentially due to the initial deliveries of the Blackwell architecture.
China's data center sales remain well below previous levels due to export controls, with no expected change in the near future.
The complexity and customization of Blackwell systems present challenges in manufacturing and gross margin improvements.
Q: As test-time compute and reinforcement learning show promise, how does this impact the potential for inference-dedicated clusters and NVIDIA's strategy? A: Jensen Huang, CEO, explained that there are multiple scaling laws, including pre-training, post-training, and test-time compute. The demand for post-training and reasoning AI is increasing, requiring more compute power. NVIDIA's architecture is designed to handle these demands, making it versatile for various AI models and ensuring a unified architecture for data centers.
Q: Can you discuss the ramp-up of the GB200 systems and any bottlenecks at the systems level? A: Jensen Huang, CEO, stated that the ramp-up of Grace Blackwell systems has been successful, with significant shipments since CES. Despite the complexity, NVIDIA has managed to scale production effectively, meeting high demand from customers like CoreWeave and Microsoft.
Q: Is Q1 the bottom for gross margins, and what gives you confidence in sustaining strong demand into next year? A: Colette Kress, CFO, noted that gross margins will be in the low 70s during the Blackwell ramp, with improvements expected later in the year. Jensen Huang, CEO, highlighted the ongoing capital investment in data centers and the shift towards AI-based software, which supports sustained demand.
Q: How do you manage the simultaneous ramps of Blackwell and Blackwell Ultra, and is the launch on track? A: Jensen Huang, CEO, confirmed that Blackwell Ultra is set for the second half of the year. The transition from Blackwell to Blackwell Ultra will be smoother due to similar system architectures, and NVIDIA is working closely with partners to ensure a successful rollout.
Q: Can you discuss the balance between custom ASICs and merchant GPUs, and the potential for heterogeneous superclusters? A: Jensen Huang, CEO, emphasized that NVIDIA's architecture is general and flexible, supporting a wide range of AI models and applications. The performance, software ecosystem, and rapid deployment capabilities make NVIDIA's GPUs a preferred choice over custom ASICs.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.