Despite weakening sales, Nvidia continues to make money

Nvidia recently announced its fourth-quarter and full-year financial results. Although the company has maximized its revenues during the pandemic period, the situation we are in is not so rosy anymore. But the green team continues to make money, even though it has experienced a noticeable drop in revenues.

The firm reported that revenue for the fourth quarter ended January 29, 2023, was $6.05 billion, down 21 percent from a year ago and up 2 percent from the previous quarter. Net income in the last quarter, on the other hand, increased by 108 percent compared to the previous quarter and reached 1.4 billion dollars, but there was a 53 percent decrease compared to the same period of the previous year.

When we look at the whole year, we see that the total revenue has remained almost unchanged and is $26.97 billion. But on the net income, that is, net profit side, things are not like that. Profitability fell 55 percent to $4.36 billion due to increased costs.

Things aren’t so bad for Nvidia

Yes, although Nvidia has experienced a serious decline in profitability, it has not taken a hit in terms of revenue. On the other hand, the place where the company lost the most money was in the graphics cards, especially on the gaming side (46 percent). Like other manufacturers, Nvidia is shipping less graphics cards instead of lowering prices to increase demand. The sentence we used to say for AMD “knowingly sells at a high price” also applies to Nvidia.

Things are not bad for Nvidia because consumer graphics cards are not the only gain of the company. For example, in the last quarter, Nvidia earned $3.4 billion from the gaming side and $3.2 billion from the data center part. While the gaming side experienced a serious decline, the data center increased by 11 percent annually. Although it has yet to earn a few hundred million dollars, the automotive segment has also increased its revenues by 135% on an annual basis. As we can see from Nvidia’s latest reports, we can say that the company has now focused on artificial intelligence and software.