Shares of Nvidia (NVDA) are soaring after the software company posted better-than-expected results in the previous quarter while boosting current quarter guidance, and said chip demand for artificial intelligence (AI) applications such as ChatGPT is surging.
CEO Jensen Huang explained that activity around AI services have “gone through the roof,” especially in the past few months, and that there is “a sense of urgency at enterprises around the world to develop and deploy AI strategies.”
He added that AI technology prospects are at an “inflection point, setting up for broad adoption reaching into every industry.” Nvidia now anticipates fiscal 2024 first quarter sales to be about $6.5 billion, above analysts’ estimates.
In the fourth quarter, the company reported earnings per share (EPS) of $0.88, with revenue falling 20.1% to $6.05 billion. Both figures exceeded forecasts. Sales for its Data Center division, which produces AI chips, rose 11%, while sales of the unit that makes semiconductors for gaming devices tumbled 46%.
Nvidia is the best-performing stock in the S&P 500, with shares up nearly 15%. Year-to-date, shares are up over 60%.