NVIDIA Announces Q3-FY24 Results; Earns 5 Times More Revenue from AI Chips than Gaming GPUs

[Assimilator]

Gaming and professional graphics will move into data center as internet connection latency and bandwidth improves. Fabbing and assembling discrete graphics cards will become a waste of resources when all computing can become distributed and client devices become dumb terminals.

In that vast sea of big data, gaming will be one of many services offered albeit a very minor one in comparison.

Monitors will become VR/AR glasses. Input devices will just be your hands. A simple handheld device in your pocket will make the connection.

In a decade, maybe. But this is now, and right now consumers are still quite happily paying for NVIDIA's GPUs. While Big Green could put all its eggs into the data centre market, there really is zero reason for it to do so. NVIDIA may be greedy, but they aren't greedy enough to throw away their massive investment into the consumer space just to chase the AI bubble that is ultimately going to pop.

It's the same way that Apple is just a phone and fart app company and nothing more.

The iPhone may be their headline product but the Mac line is and always will be a money-spinner.

 

[john_]

Those gross margins sure are gross.

I think they are just understated. I know that Nvidia is in the stock market and they can't lie, but I doubt those are real. When in mining period Nvidia was selling graphics cards at twice their price(I doubt they where sticking at MSRP when selling directly to mining farms) and was reporting 3-5 extra points than usual, now they are selling AI equipment and they only gone up a few more points in the profit margin?
Doubt it. I believe it is triple digit.

 

[Bwaze]

But this is now, and right now consumers are still quite happily paying for NVIDIA's GPUs. While Big Green could put all its eggs into the data centre market, there really is zero reason for it to do so. NVIDIA may be greedy, but they aren't greedy enough to throw away their massive investment into the consumer space just to chase the AI bubble that is ultimately going to pop.

Sure, but it doesn't mean Nvidia really has to offer anything inviting to gamers for now. As it happened during the cryptomadness.

There are buyers, but let's not pretend gamers are buying RTX 4090 a year and a half after it's release for 10 - 20% over MSRP!

 

[R0H1T]

The iPhone may be their headline product but the Mac line is and always will be a money-spinner.

Their biggest money spinner is services - Appstore/subscriptions & of course the Apple ecosystem. Same goes with Nvidia & CUDA, though it's arguable if they would be extracting same amount of profits in 10 years time, unlike the inherent advantage with all things Mac!

 

[Denver]

The NVIDIA haters are out in force as usual. Why is it so difficult for y'all to accept that a wildly successful and profitable company is wildly successful and profitable because it has product that the market wants to buy? Why do you have to invent ludicrous allegations of illegal behaviour?

Hate is a strong word, I see rational arguments from those who criticize Nvidia. Do you have the courage to back your opinions with financial stakes? Do you genuinely believe Nvidia is a trillion-dollar company?

I bet anyone that Nvidia will fall below Intel and AMD in market value within the next year, they are just easily replaceable in the main markets they operate in.

 

[MrDweezil]

Stadia was dead within a year, we are probably looking at different walls

It'll happen. Companies are pushing it prematurely, but it'll happen eventually.

 

[Assimilator]

Sure, but it doesn't mean Nvidia really has to offer anything inviting to gamers for now.

The fact that gamers are buying NVIDIA cards trivially demonstrates this is false.

Their biggest money spinner is services

Yes, that is more correct than what I said.

Hate is a strong word, I see rational arguments from those who criticize Nvidia.

Show me these alleged rational arguments, because all I see are completely unsubstantiated conspiracy theories that these reported figures are only possible if NVIDIA is lying or breaking the law in some way.

Do you have the courage to back your opinions with financial stakes? Do you genuinely believe Nvidia is a trillion-dollar company?

It doesn't matter what I believe, all that matters is the evidence. And there has been zero evidence provided that NVIDIA is not the wildly profitable company it claims to be.

I bet anyone that Nvidia will fall below Intel and AMD in market value within the next year, they are just easily replaceable in the main markets they operate in.

So easily replaceable that they are continuing to gain market share over their competitors, in the markets that they operate in.

 

[nguyen]

It'll happen. Companies are pushing it prematurely, but it'll happen eventually.

They are different markets, it's like a guy can have a PC, a laptop, a Steam Deck and a Geforce Now subscription all at the same time, having one does not exclude one from owning others.

The only possibility of Nvidia stop selling gaming GPU is when PC gaming died out, which honestly will not be happening any time soon.

 

[thesmokingman]

I'm surprised anyone is surprised. Wtf do yall think 70% profit margin and a captive market looks like? I caught part of the earnings call and it was hilarious. Jensen proclaiming that making these cards is so damn hard, every aspect, hell even the shipping is hard work. Pulling back though and we can see that this market will shrink with AMD moving with better spec'd cards and the major players moving to custom chips. One wonders how long this gravy train will run for?

 

[TheoneandonlyMrK]

In a decade, maybe. But this is now, and right now consumers are still quite happily paying for NVIDIA's GPUs. While Big Green could put all its eggs into the data centre market, there really is zero reason for it to do so. NVIDIA may be greedy, but they aren't greedy enough to throw away their massive investment into the consumer space just to chase the AI bubble that is ultimately going to pop.


The iPhone may be their headline product but the Mac line is and always will be a money-spinner.

Plus where else would they. Beta test hardware and software on millions of consumer GPU.
Consumers paid for and beta tested Nvidia's AI hardware for years giving it the resources to develop this reality.

They're not giving that up.

 

[the54thvoid]

I can't wait until the AI investment reaps such rewards that I can enquire about whether or not I'll actually enjoy a new game, and after a quick discussion with a faceless digital intelligence, I'll know now to buy it. Jensen better watch out, his cards might just deter us all from buying new games.

Clearly, tongue-in-cheek. But sort of relevant.

 

[kapone32]

Let me see a 4090 where I live costs minimum $2300 ($2600 with tax). Then you could get a 7900XT for $1200. Nvidia will sell 20 in a day and AMD would have to sell 50 to make the same amount. That would need common sense though. That 81% is probably relegated to USA and Australia because the best thing Nvidia is good at is marketing. They are so good that the day they announced the 4090 it was the death of the 3090 in the narrative, but the 3090TI was good at that too. Now the US is fearful of the Chinese using 4090s for Machine Learning of Drones and Nvidia ramps up production while making more money than is right, to be so desultory in their hubris that EVGA left them and the people said oh well. Even the new 12vHPWR that is still burning GPUs cannot change the narrative but I will continue hearing about how evil AMD is for not putting DLSS in Starfield. It doesn't matter though because AMD also has complete control of the handheld space and when the Pheonix APUs launch on desktop you can say goodbye to 1030,1060,1660,3050,4050 and also 570,580 cards from AMD but that will impact Nvdia's bottom line in no way.

 

[cvaldes]

I bet anyone that Nvidia will fall below Intel and AMD in market value within the next year, they are just easily replaceable in the main markets they operate in.

Highly unlikely.

Market cap
NVDA $1.22T
AMD $200B
INTC $185B

Nvidia would have to lose about 85% of its value to drop below AMD if the latter stayed even. However if NVDA dropped that much it would drag down the entire semiconductor sector as well as make a major dent in broad market indexes like the S&P 500, Nasdaq Composite and NASDAQ-100.

Nvidia does not function in a vacuum.

As for putting my money where my mouth is, I have indirect positions in all three via a variety of index funds.

AI isn’t going away, I will make money regardless who has market dominance a year from now.

Remember that revenues equals shipped products and paid services. Nvidia’s inbox is stacked with purchase orders, probably enough to keep TSMC busy for two, three years.

This isn’t Joe Gamer standing in front of a store shelf at Microcenter debating whether or not to buy a GeForce 4070.

Companies budget for these purchases in advance.

 

[dyonoctis]

Gaming and professional graphics will move into data center as internet connection latency and bandwidth improves. Fabbing and assembling discrete graphics cards will become a waste of resources when all computing can become distributed and client devices become dumb terminals.

In that vast sea of big data, gaming will be one of many services offered albeit a very minor one in comparison.

Monitors will become VR/AR glasses. Input devices will just be your hands. A simple handheld device in your pocket will make the connection.

I think that the hybrid approach will keep being a thing until 100% of earth surface will have a perfect internet coverage with strong fall backs in case something goes wrong. Ending up with a potato computer whenever something goes south, or when you need to work in a remote area is going to be a big liability.

It's a bit like Toyota explaining that even if the west want to go full electric, there's a lot of places where it's just not going to work. You need alternative technologies to cover the weakness of the other one

 

[Assimilator]

Plus where else would they. Beta test hardware and software on millions of consumer GPU.
Consumers paid for and beta tested Nvidia's AI hardware for years giving it the resources to develop this reality.

They're not giving that up.

"Beta test" what is this stupid shit? How are any of NVIDIA's products "beta"?

 

[TheoneandonlyMrK]

"Beta test" what is this stupid shit? How are any of NVIDIA's products "beta"?

What.

Tensor cores, useful Eventually, occasionally.

Raytracing core's useful Eventually and occasionally

Dlss all upto version blah blah blah

Many other things time's IMHO.

So yeah as an owner/Beta tester yes.

 

[mrnagant]

Game revenue is pretty boring. $2.8B. It has been higher in the past. Used to always be their #1 segment. That datacenter is popping. 80% of their Q3 and projected to be 75% of their Q4. Nvidia can basically just not care about gaming anymore in terms of cost. They can sell their cards for whatever they want and don't need to drop prices. If they don't sell they will gladly shift that production over to the datacenter and make hundreds of thousands of dollars more per wafer. Then their top end cards, they don't even need to sell them. They can just paper launch them and then not allocate any chips for gaming.

In one regards it is really exciting, but then in another it is kinda scary. We will get Blackwell, but it could be limited and expensive. AMD is skimping out on RDNA4. AMD is going to focus on their CPUs and I'd imagine put their GPU resources behind CDNA. ATM, gaming isn't the juggernaut in terms of revenue that it used to be and it obviously isn't where the money is. So I can see options being reduced (everyone), prices going up (Nvidia), and development slowing down (AMD).

Maybe if GPU cores go chiplet it won't be too bad.

 

[Denver]

Highly unlikely.

Market cap
NVDA $1.22T
AMD $200B
INTC $185B

Nvidia would have to lose about 85% of its value to drop below AMD if the latter stayed even. However if NVDA dropped that much it would drag down the entire semiconductor sector as well as make a major dent in broad market indexes like the S&P 500, Nasdaq Composite and NASDAQ-100.

Nvidia does not function in a vacuum.

As for putting my money where my mouth is, I have indirect positions in all three via a variety of index funds.

AI isn’t going away, I will make money regardless who has market dominance a year from now.

Remember that revenues equals shipped products and paid services. Nvidia’s inbox is stacked with purchase orders, probably enough to keep TSMC busy for two, three years.

This isn’t Joe Gamer standing in front of a store shelf at Microcenter debating whether or not to buy a GeForce 4070.

Companies budget for these purchases in advance.

I am of the opinion that Nvidia is not worth 1 trillion dollars and is likely to fall significantly below its current valuation.

I choose not to engage in the seemingly endless debate of Nvidia vs AMD vs Intel. My conviction in my perspective led me to exit at $500. If you genuinely believe in the positive prospects, consider purchasing the stock at this price point. Opinion is subjective, reality is not, and it eventually imposes itself by subjugating individual opinions.

The future will show who was right. Good luck!

 

[cvaldes]

I am of the opinion that Nvidia is not worth 1 trillion dollars and is likely to fall significantly below its current valuation.

I choose not to engage in the seemingly endless debate of Nvidia vs AMD vs Intel. My conviction in my perspective led me to exit at $500. If you genuinely believe in the positive prospects, consider purchasing the stock at this price point. Opinion is subjective, reality is not, and it eventually imposes itself by subjugating individual opinions.

The future will show who was right. Good luck!

Okay, you torched your own ass and you can't admit it.

First of all, I addressed your statement that NVDA would drop below AMD and INTC in valuation within a year. I showed market cap and you won't accept raw numbers. That's fine. But this is ON YOU.

Second, yes, you chose to engage in the endless debate of Nvidia vs. everyone else via your previous post. You mentioned no exit at $500.

And guess what? Unless your dollars are fully invested in something that returns better than NVDA, well, you lose. I know. I bailed out of NFLX after owning it for 18 months and it climbed through the stratosphere. Sure, I made money but not the same amount if I kept it.

We all have to sleep though. If you can't handle the suspense, just say so. No one can blame you for bailing out to get enough shut eye. But don't misconstrue it with making more money.

Third, even if NVDA doesn't have the same price acceleration in the next twelve months as it has in the previous 12, it's still more than losing 85% of market cap value, isn't it?

My money is that that in 12 months NVDA's market cap will still be higher than that of AMD or INTC.

You proposed something else and I might just bookmark this discussion just to revisit it in a year to see where we stand. Let me know if you'd like me to ping this thread a year from now.

Good try trying to cover your sorry ass on what you posted. Since I included your post, you can't back out. Everyone reading this thread will understand what sort of odds you are up against.

Feel free to respond to this, you will only dig a deeper grave for yourself. Remember: you are on the record for proposing that NVDA will have a lower market capitalization on November 22, 2024 than AMD. Technically, you stated that NVDA would be lower than both AMD and INTC. But let's just start with AMD. We get plenty of garbage chat here at TPU but this one is worth highlighting just due to its complete ludicrousness.

Best of luck.

 

[wolf]

"Beta test" what is this stupid shit? How are any of NVIDIA's products "beta"?

It's a funny and I agree fairly ridiculous sentiment, not that I don't see how they arrived at it, but it's still silly.

If we were going to take that route and follow that logic, I'd argue that FSR 1/2/3 and Antilag+, perhaps others - they're beta features the users are testing, just on a smaller scale because they lack the vision to foresee (most of) these prospective innovations. Consumers paid for and beta tested AMD's reactionary hardware and software solutions for years giving AMD the resources to just barely stay in the PC space. Seen a fair few Radeon's sold, or purchases delayed, on hopium that they can match Nvidia's hardware and features, so Nvidia's features can't be all that bad if AMD aspires to meet or exceed them.

Consumers rarely can tell or steer the market in how to innovate, they want more, faster, better, but largely of known quantities. A 5090 that has 48GB and is twice as fast in every metric to a 4090? sounds great right? (price excluded for point making purpose), A monitor that's higher res and faster refresh, awesome! But average Joe would be hard pressed to predict or ask for the newer features and capability GPU's have come out with over the years. RT, Upscaling, Mesh Shading, Tessellation, and so on.

 

[FoulOnWhite]

Good luck to them all, we are just the mice running around the maze while they drop tidbits in there for us. Don't complain when you have a 4090 in your PC

 

[Assimilator]

What.

Tensor cores, useful Eventually, occasionally.

Raytracing core's useful Eventually and occasionally

Dlss all upto version blah blah blah

Many other things time's IMHO.

So yeah as an owner/Beta tester yes.

Every single one of the features you mentioned is used by gamers, improves or enhances gameplay for those gamers, and are constantly being improved at no cost to purchasers of the associated hardware. "Beta" doesn't mean "feature that you personally have an irrational hatred for".

The fact of the matter is that these features are the very example of "when life gives you lemons, make lemonade". NVIDIA chose to dedicate more die space on its GPUs to ML- and RT-accelerating hardware because they didn't want to have to endure the cost and complexity of producing different GPUs for consumer and professional workloads. This hardware took away from raster hardware, which created a problem that their consumer products might no longer be able to compete on sheer performance. Instead of sitting back and hoping that wouldn't bite them, NVIDIA came up with feature solutions to leverage that hardware to add value for consumers. And they've been so successful in that regard, that those features have become the industry standard such that every single one of their competitors now has their own version of said features. That's not because those competitors slavishly copy whatever NVIDIA does, it's because consumers now expect those features as standard.

Basically, NVIDIA invented an entire new category of consumer graphic features entirely because they wanted to save money, and they've utilised those features so successfully that they've increased their market leadership. That's the very opposite of "beta", that's "astounding success", and your irrational hatred doesn't change that; it just makes you look ridiculous.

I've said it before and I'll say it again - NVIDIA's self-proclaimed moniker of "World Leader in Visual Computing Technologies" is incredibly pompous but entirely justified. They lead, they succeed, and others follow.

 

[Denver]

Okay, you torched your own ass and you can't admit it.

First of all, I addressed your statement that NVDA would drop below AMD and INTC in valuation within a year. I showed market cap and you won't accept raw numbers. That's fine. But this is ON YOU.

Second, yes, you chose to engage in the endless debate of Nvidia vs. everyone else via your previous post. You mentioned no exit at $500.

And guess what? Unless your dollars are fully invested in something that returns better than NVDA, well, you lose. I know. I bailed out of NFLX after owning it for 18 months and it climbed through the stratosphere. Sure, I made money but not the same amount if I kept it.

We all have to sleep though. If you can't handle the suspense, just say so. No one can blame you for bailing out to get enough shut eye. But don't misconstrue it with making more money.

Third, even if NVDA doesn't have the same price acceleration in the next twelve months as it has in the previous 12, it's still more than losing 85% of market cap value, isn't it?

My money is that that in 12 months NVDA's market cap will still be higher than that of AMD or INTC.

You proposed something else and I might just bookmark this discussion just to revisit it in a year to see where we stand. Let me know if you'd like me to ping this thread a year from now.

Good try trying to cover your sorry ass on what you posted. Since I included your post, you can't back out. Everyone reading this thread will understand what sort of odds you are up against.

Feel free to respond to this, you will only dig a deeper grave for yourself. Remember: you are on the record for proposing that NVDA will have a lower market capitalization on November 22, 2024 than AMD. Technically, you stated that NVDA would be lower than both AMD and INTC. But let's just start with AMD. We get plenty of garbage chat here at TPU but this one is worth highlighting just due to its complete ludicrousness.

Best of luck.

So much excitement coming from someone ready to lose money. Unlike you, I have all the serenity in the world.

Nvidia does not necessarily need to lose so much market value to fall below Intel and AMD, they just need to both grow while Nvidia continually weakens with the rise of competition and battles to make AI cheaper.

Furthermore, I just don't invest in what I don't believe in, It doesn't matter if banks or analysts say otherwise. If I lose or win, it will be by following what makes sense to me. GG.

 

[ratirt]

I would really like to see gaming units sold not just the revenue part. Strictly for comparison. You may have the same number of units sold but if you jack up the price per unit, obviously your revenue will increase. I wonder, how these stats look like.

 

[TheoneandonlyMrK]

Every single one of the features you mentioned is used by gamers, improves or enhances gameplay for those gamers, and are constantly being improved at no cost to purchasers of the associated hardware. "Beta" doesn't mean "feature that you personally have an irrational hatred for".

The fact of the matter is that these features are the very example of "when life gives you lemons, make lemonade". NVIDIA chose to dedicate more die space on its GPUs to ML- and RT-accelerating hardware because they didn't want to have to endure the cost and complexity of producing different GPUs for consumer and professional workloads. This hardware took away from raster hardware, which created a problem that their consumer products might no longer be able to compete on sheer performance. Instead of sitting back and hoping that wouldn't bite them, NVIDIA came up with feature solutions to leverage that hardware to add value for consumers. And they've been so successful in that regard, that those features have become the industry standard such that every single one of their competitors now has their own version of said features. That's not because those competitors slavishly copy whatever NVIDIA does, it's because consumers now expect those features as standard.

Basically, NVIDIA invented an entire new category of consumer graphic features entirely because they wanted to save money, and they've utilised those features so successfully that they've increased their market leadership. That's the very opposite of "beta", that's "astounding success", and your irrational hatred doesn't change that; it just makes you look ridiculous.

I've said it before and I'll say it again - NVIDIA's self-proclaimed moniker of "World Leader in Visual Computing Technologies" is incredibly pompous but entirely justified. They lead, they succeed, and others follow.

I owned a 2060 since the beginning.

Who do you think you are trolling.

Nvidia trolled me .

I sat through months of no use of features because f all used them, BeTA.


I also tested most iterations of dlss because they can't make one right first time and guess what none are at iterative one because we beta tested them found issues for Nvidia.

I'm sorry this insults your master but deal with it.