Nvidia beats expectations, stock jumps

Nvidia beats expectations, stock jumps

Nvidia CEO Jensen Huang (Photographer: David Paul Morris/Bloomberg via Getty Images)

Nvidia (NVDA) announced its Q4 2019 earnings on Thursday, exceeding analysts’ expectations. The chipmaker reported revenue of $2.21 billion versus analysts’ expectations of $2.2 billion.

Earnings per share for the firm came in at $0.80 versus expectations of $0.78.

The stock is up more than 5% in after hours trading.

In January, Nvidia CEO Jensen Huang sent a letter to shareholders revising the company’s Q4 guidance, cutting its expected revenue from $2.7 billion to $2.2 billion. The move put pressure on the stock, and, according to Huang, was tied to macroeconomic issues, specifically in China.

Nvidia has made a significant push into the artificial intelligence and machine learning industries thanks to its data center processing technologies, but the company still relies primarily on its gaming business for more than half of its revenue.

China’s slowing economy is hurting sales for discretionary spending items like Nvidia’s high-priced gaming graphics cards, which allow gamers to play some of the latest games on the market.

For Q4, the company reported gaming revenue of $954 million, a steep drop compared to its Q4 2018 gaming revenue, which came in at $1.74 billion.

Outside of gaming, Nvidia saw some of its corporate customers put off data center purchases, which cut into its bottom line.

The company’s data center business, however, increased year-over-year from $606 million to $679 million.

Email Daniel Howley at dhowley@oath.com; follow him on Twitter at @DanielHowley. Follow Yahoo Finance on Facebook, Twitter, Instagram, and LinkedIn.finance.yahoo.com/

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