NVIDIA Corporation Q1 FY2020 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Q1 revenue was 2.2 billion dollars, down 31 percent year-over-year but up 1 percent sequentially. Performance aligned with expectations.
  • GAAP gross margin was 58.4 percent, down year-over-year due to gaming mix; non-GAAP gross margin was 59 percent.
  • GAAP EPS was 0.64 dollars; non-GAAP EPS was 0.88 dollars.
  • Company did not repurchase stock in Q1 due to the pending Mellanox acquisition. Total capital returns committed: 3 billion dollars by end of FY2020.

Business Segment Performance

Gaming

  • Revenue of 1.05 billion dollars, down 39 percent year-over-year but up 11 percent sequentially.
  • Turing product ramp progressing well; mid-range GeForce GTX 1660 Ti, 1660, and 1650 launched and driving improved channel inventory conditions.
  • Gaming laptop momentum strong; nearly 100 new models shipping in 2019 versus ~40 in prior year. Entry price starts at 799 dollars.
  • Ray tracing ecosystem gaining momentum with support from major engines like Microsoft DXR, Unreal, and Unity.
  • GeForce NOW cloud gaming service now at 300,000 monthly active users with 1 million on waitlist; expanding via SoftBank and LG UPlus partnerships.

Data Center

  • Revenue of 634 million dollars, down 10 percent year-over-year and down 7 percent sequentially.

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Operator: Good afternoon. My name is Kristina, and I'll be your conference operator today. Welcome to NVIDIA's financial results conference call. All lines have been placed on mute. [Operator Instructions] I'll now turn the call over to Simona Jankowski from Investor Relations to begin your conference. Simona Jankowski: Thank you. Good afternoon, everyone. And welcome to NVIDIA's conference call for the first quarter of fiscal 2020. With me on the call today from NVIDIA are Jen-Hsun Huang, President and Chief Executive Officer and Colette Kress, Executive Vice President and Chief Financial Officer. I'd like to remind you that our call is being webcast live on NVIDIA's Investor Relations Web site. The webcast will be available for replay until the conference call to discuss our financial results for the second quarter of fiscal 2020. The content of today's call is NVIDIA's property. It can't be reproduced or transcribed without our prior written consent. During this call, we may make forward-looking statements based on current expectations. These are subject to a number of significant risks and uncertainties and our actual results may differ materially. For a discussion of factors that could affect our future financial results and business, please refer to the disclosure in today's earnings release, our most recent Forms 10-K and 10-Q and the reports that we may file on Form 8-K with Securities and Exchange Commission. All our statements are made as of today, May 16, 2019, bas

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