Nvidia Reports Second Quarter Fiscal Year 2023 Financial Results

The financial report shows that in the second quarter of the fiscal year 2023, Nvidia’s revenue was $6.704 billion, a year-on-year increase of 3% and a month-on-month decrease of 19%. Net profit was $656 million, down 72% year-on-year and 59% month-on-month. Among them, the game business revenue was $2.04 billion, a year-on-year decrease of 33% and a month-on-month decrease of 44%. The data center business revenue was $3.81 billion, an increase of 1% month-on-month and a year-on-year increase of 61%. The visualization business is expected to generate about $496 million in revenue, a year-on-year decrease of 20% and a month-on-month decrease of 4%. The automotive business is expected to report revenue of $220 million, up 45% year over year. In addition, Nvidia’s gross margin has plummeted, to 43.5% from about 65% in recent quarters.

During the quarter, Nvidia stock was at $3.89 billion, nearly double the $2.11 billion in the year-ago quarter. Inventory purchases and long-term supply obligations totaled $9.22 billion, also nearly double what they were a year ago. Like many of its peers, Nvidia’s difficulties are shifting from supply shortages to rapidly expanding inventories of unsold products. Nvidia has to deal with upfront payments for materials and product manufacturing, and at the same time, chip inventory levels are rising due to falling market demand.
“We are navigating our supply chain transitions in a challenging macro environment and we will get through this,” said Jensen Huang, founder, and CEO of NVIDIA.

Nvidia expects revenue for the third quarter of fiscal 2023 to be $5.9 billion, plus or minus 2%, down 17% year over year and 12% sequentially, well below analysts’ expectations of $6.92 billion. Nvidia’s stock repurchase program currently has an authorization limit of $11.93 billion, and stock repurchases should continue this fiscal year.