Graphics card and chip company Nvidia continues to earn millions of dollars despite declines in desktop sales. Although reported earnings were $1.4 billion, which would be half of the previous quarter, it still marks money coming into the company. In a report filed a few weeks ago, the firm acknowledged that it would have a drop in fiscal 2023 earnings.
Nvidia had just reported $7.64 billion, a record for the company. By the fourth quarter of 2023, it is believed that it could reach US$6 billion. Although earnings have fallen by more than 50 percent, the proceeds are very similar to the previous year’s earnings. Although the PC market has entered a crisis, the company has been establishing values that place it above the status quo of the rest of the manufacturers.
Growing business for Nvidia
The company confirmed its record automotive revenues of approximately US$294 million. The drop was due to the company’s graphics business. In the gaming area there was a decrease in revenues of around 46 percent. There, the decline was immersed in lower shipments of SoCs (system on a chip) for game consoles. Nintendo currently no longer sells as many Switch consoles, which is the only game console that uses an Nvidia chip.
Like other chipmakers, the company has been shipping fewer GPUs to retailers and partners, rather than cutting prices. Its objective is to reduce sales to help reduce inventory levels in the face of current demand. Nvidia did not overlook the disruptions in China due to Covid19 and other issues.
A global problem for the market
The various PC manufacturers have reported that demand for computers plummeted in the last quarter. Research firm Gartner predicted a drop of around 30 percent. Gartner called the decline the largest since the company tracks the PC market in the mid-1990s.
This data from the research firm acknowledges the drop that Nvidia had already pointed out. Other manufacturers such as AMD were more optimistic this quarter about declining numbers. In addition, it was suggested that processor and client game revenues will continue to decline during the first half of this year.
Jensen Huang, CEO of Nvidia, has been optimistic about his company’s sales recovery. Nvidia has been addressing the promotion of its potential in the growth of data center-related businesses, particularly on the rise of large language models (LLM). The latter is used to train artificial intelligence systems, such as ChatGPT or Bing’s AI. The manufacturer has also approached the world of vehicles with its software for the Mercedes-Benz company fleet.