NVIDIA Q4 (Nov/Dec/Jan) beat again, and Q1 guidance also beat (Q1 revenue guide $43B vs. consensus $42.3B); this time there was no "failed to beat the highest whisper number" narrative, but the market revived the early-January CoWoS cut rumors. As the highest-revenue, highest-net-income company in global semiconductor history, NVIDIA keeps shattering industry ceilings as if defying a taboo.
Data center Q4 revenue $35.58B, up 16% sequentially, 91% of total NVIDIA revenue. This quarter's data center growth driven by Blackwell shipments and H200 demand; Blackwell single-quarter revenue surpassed $11B (prior guide was "several billion"), breaking the record for fastest ramp to $10B+ set by H200 last quarter; GB200 early shipments primarily used for inference; CSPs accounted for 50% of data center revenue, internet and verticals 50%; China data center share remains below pre-export-control levels, expected to persist at this level;
Inside Data Center:
Compute revenue $32.556B, up 116% year over year, up 18% sequentially; transition from Hopper to Blackwell is far more complex than Blackwell to Blackwell Ultra, involving NVL8 to NVL72; Blackwell Ultra to volume in H2; installed base of Volta, Pascal, Ampere customers still awaiting refresh;
Networking revenue $3.024B, down 9% year over year, down 3% sequentially; product mix shifting from small NVLink 8 with InfiniBand to large NVLink 72 with SpectrumX; networking attached to GPU compute systems >75%; first Stargate data centers to use SpectrumX; Q1 expected to return to growth. Full-year 2024 networking revenue scale may approach Broadcom; overtaking Broadcom likely waits until 2025;
Per guidance, Q1 revenue $43B, up 65% year over year; GAAP net income $21.2B, up 43% year over year; Non-GAAP net income $22.7B, up 49% year over year. Regarding the market's gross margin concern (guided down to 70.5%), Blackwell is genuinely complex, delayed by half a year, pushing all other product lines back; the margin impact is within reason; just hope Blackwell Ultra and Vera Rubin supply chains avoid further hiccups.
In the earlier piece "NVIDIA Q1 Earnings: AI Supercomputer Is Not a 'Pick-and-Shovel Play,' It's a 'Money Printer'," I noted "optimistically, full-year 2024 Non-GAAP net income could challenge $80B"; actual full-year came in at $74.2B, slightly dented by Blackwell supply-chain issues.
Of course, views on AI sustainability differ; skepticism, bearishness, and FUD toward NVIDIA have never ceased. I maintain my prior view: NVIDIA's future growth may come from two shifts: data center growth expanding from cloud-dominated to verticals and sovereign AI everywhere (DeepSeek accelerated AI democratization), and the seven-chip product matrix and roadmap moving from biennial to annual cadence. On AI trends, inference demand is just beginning to explode; per Jensen's target, every tech company will need 24/7 inference. Many may have missed that DeepSeek's Open-Source Week Day 6 disclosed 545% ROI, yet Jensen mentioned on the 24Q1 earnings call that AI API providers see 4-year ROI of 6x.
On China, I still hold the prior view: "Given US-China dynamics, AI decoupling is inevitable; better a short pain than a long one."
FY25Q4 Call Highlights:
Blackwell gross margin: expect low-70%s during ramp, improving to mid-70%s by year-end;
Q4 repurchased $7.8B, dividends $245M; Jan 27-Feb 21 repurchased $3.7B (during DeepSeek episode), $35B authorization remaining;
Purchase commitments and obligations for inventory and manufacturing capacity were $30.8 billion (QoQ+7%) . Prepaid supply agreements were $5.1 billion (QoQ-2%) . DIS of 86 (QoQ+8) .
For the quarter, by billing location: US accounted for 51% of revenue, Singapore 16%, Mainland China 14%, Taiwan 13%; the top customer represented 12%, the second 11%, and the third 11%.
Overall, on this earnings call, Jensen Huang again emphasized three major scaling laws: pre-training, post-training, and inference-time scaling. Inference-time scaling is just getting started, and multimodal AI, enterprise AI, sovereign AI, and physical AI are also just getting started.
Previously noted: the beat-and-raise 10-for-1 split implied management expects annualized net income >$100B. If quarterly EPS returns to $1, that implies $25B quarterly net income, a $100B run rate, likely achieved this year with Blackwell. This year will likely see the milestone of net income surpassing Apple to become #1 globally.
For NVIDIA, this past year has truly seen no company experience such extreme stock volatility, such wide investor divergence, such intense media smear campaigns, such heavy US policy pressure, and such a poor holder experience. That may be precisely why most investors have been scared off—everyone fears uncertainty more.