🔴NVIDIA Q2 2024 Earnings Call LIVE: Financial Results Stock Update Market Reaction - $NVDA

is kind of in in in its own world and we talk about this idea here that when you have a company that's so outsized in the market here how do you push back on that if you're an investor do you just go along for the ride this is sort of like don't fight the FED don't fight Nvidia you have to go along for the ride because I mean if not then you're going to underperform and that's the risk out there for any active investor all right we're going to walk you through all of those earnings including Nvidia so let's get right to the numbers here on a closing basis everything pretty much in the red across the board the D Jones Industrial Average down more than 100 points or 4/10 of a percent the S&P down more than 30 points or 6/10 of a percent the NASDAQ is going to close out the day down by more than a percent and the Russell 2000 Carol Maser uh closing the day down by about 7/10 of 1% all right so a little bit lower so back to the big caps I go guys uh you had about 214 names in the S&P 500 actually gaining ground today 285 losing ground and then Scarlet you had four unchanged all right let's take a look at the IMAP it's going to be pretty much a red pizza pie um a little bit of green there the only green really is in the financials and the healthcare space and they're marginally higher the big lagers on the day Tech consumer discretionary and communication Services which basically encompasses The Magnificent Seven uh you've got consumer discretionary and Tech each down at least 1% Carol all right guys to some of the individual movers uh we have chewy uh up about 11% today rallying to the highest in about a year uh to its highest I should say uh the company came out second quarter res results and gave an Outlook that was positive we've got some earnings we probably should go to them let's do sales for us now crossing the wire right now in its most recent quarter sales coming in slightly above estimates at about 2.07 billion the street was looking for 2.01 operating income beating slightly here at 3.14 the street was looking for 2.96 EPS also a slight beat at $256 a share here's your forecast for the full year the company is guiding Revenue 37.7 billion to 38 bli that's the range that it's giving uh the street was looking on average for $ 37.8 billion here so uh relatively inline with estimates on the forecast and a modest speat guys for the most recent quarter all right let's take a look at net apppp which is a a storage company so it's hardware and net app reporting for the quarter that ended EPS that beat analyst estimates a17 for the quarter excuse me that is uh on a net basis adjusted EPS a156 versus a consensus estimate of a145 Revenue topping the average analyst estimate as for this quarter it these net revenue of anywhere from 1.57 to 1.72 billion uh the consensus estimate is 1.62 billion and net app still sees full year adjusted gross margin of 71 to 72% the stock not moving yet in after hours trade okay I'm taking a look at shares of OCTA they're uh not moving in after hours trading either but second quarter adjusted earnings per share did beat estimates uh EPS came in at 72 cents versus estimates of 61 cents Revenue was up 16% year-over-year it came in above estimates at $646 million all right uh we do want to go back to Salesforce of course at least for right now that is the biggest uh company reporting out there here the president and CFO of the company her name's Amy Weaver she is stepping down from the company though she will remain CFO until a successor is named I'm not quite seen the reason for her departure here but of course we do know there has been a lot of talk here about the SE Suite up there at Salesforce whether uh some of the folks there were aging out whether they needed to change Amy Weaver the president and CEO uh going to be stepping down once a successor is found for her position yeah it looks like she was named CFO back in early 2021 so been there for a few years let's go to another one Crossing uh the retailer Five Below guys coming out with its latest results let's go to the Outlook fiscal year adjusted EPS $435 to 471 uh looks like it's opening a little bit of that range the estimate out there is 4 75 so that's below uh that the stock though is up almost 4% here third quarter adjusted EPS 10 to 22 cents uh estimate on the street is 15 cents a share third quarter net loss of 2 million to 13 million and third quarter net sales of 780 million to 800 million the estimate on the street is 79.2 million and let's go to the second quarter uh last quarter what it did second quarter EPS 60 cents a share and that's 6 cents better than what the street was expecting and Scarlet you've got that stock rallying about 5% here yeah Five Below up 5% of course they um sell affordable items Five Below up 5% no oh I didn't even think about that yeah you're right um they they do sell for useless facts keep them coming you know any company that delivers value to a consumer is in fashion right now I'm just looking at the overall after hours trade right now in terms of most active Stocks by value and Salesforce up almost 2% but the other names that we've gone through you're not seeing a whole lot of activity in those companies and after hours trade inv we should mention up margely uh after declining in regular trading before its results come out okay so now as investors have had a chance to check out shares of OCTA and the results of OCTA uh shares down about 3% in the after hours uh this does come after the company reported its latest results that did show that it beat on the top line and on the bottom line I am curious guys I mean obviously we're kind of biting time here until we get to those Nvidia earnings here and there's been a lot of talk here uh about the waiting in the S&P 7% 11% in the NASDAQ Composite 14% in the sock so it doesn't matter what this stock does it's going to move the broader Market we're getting some other earnings right now all right so let's get to them we've got crowd strike crossing the Bloomberg terminal let me just bring it up here on my terminal and you've got crowd strike second quarter Revenue folks it's h a slight beat 963.com good afternoon everyone thank you for tuning in to the live stream the Nvidia earnings will kick off at 4:30 we'll flip over onto the earnings once uh once they make it available so the current charts we're paying attention to is very critical we have the S&P 500 at the bottom left corner qqq's and the Dow and these are the names right over here that will that that Nvidia will directly have an impact on this is the SMH this semiconductor ETF this is TSM this is aago this is AMD right here this is qcom and this this is Microsoft Amazon meta and Google and these four companies make up 40% of nvidia's uh clients right so very very important to see where it takes what takes place here and the expected move on Nvidia earnings is 10.9% plus minus so if we Gap up 10% that's going to be at that 13838 down 10% for where we are will lead us at that 11125 and alltime Highs inidia are right at that 14070 six so thank you for tuning in make sure to like make sure to subscribe and enjoy the rest of the stream if you have any questions drop it in the chat I need to answer if I need to unmute I will uh address those questions so thank you for tuning in guys and enjoy talk about names basically kind of in that broader software Tech space and you are getting a better sense here of the health of these companies and more importantly the health of consumer uh of uh excuse me corporate spending uh and that of course is going to be a big theme when we get to Nvidia we know they're making a lot of money we know they have Revenue growth here but we've already heard from some of the big hyperscalers that they have taken a closer look at their AI spend and decided that maybe it was a little bit too much too soon you know that's funny that you bring that up too because I was thinking about um we had a conversation with um Ian King and he was talking about specifically for NVIDIA when I'm just putting up the supply chain function analysis on the Bloomberg and that when you've got a company like Microsoft that's already 45% of their cap back spend is NVIDIA meta it's 41% how much more can they get from their big customers it's something to think about what the future spend is and how that impacts Nvidia and their top line going forward I don't want to cut into your long goodbye but I but that's a great point I really encourage everyone to to do that was it splc because I was looking at that this morning too and I didn't realize how much of nidia's Revenue was dependent on basically just five big tech companies was like 50% super micro computer who's who a big Tech right aren't you glad I a little small and I bring you added pretty big Tech you didn't get we didn't get to the decliners but super micro was top of the list for me guys all right Nvidia guys just up about 110 unchanged in the aftermarket you know what Scarlet I'm with you I'm just going to say I'm with you all right look at that envidia to come everybody right that's a wrap for crossplatform radio tv YouTube Bloomberg Originals we both on both sides watching for those Nvidia earnings but uh the team will see you again same time same place tomorrow and the clock is still tucking we are waiting for NVIDIA we will have a full breakdown of those results the second they hit the wire this is the close on Bloomberg [Music] welcome back to the close I'm Scarlet Fu and I'm Romain Bostic stocks on the back foot on the day here the volume was light as everyone is waiting of course on those results out of Nvidia an S&P 500 the closed lower on the day but well off the lows of the day down about 6/10 of a percent but you see the Philadelphia semiconductor index a 2% drop on the day a big drag from Nvidia as a lot of folks trying to front run those earnings if you're looking for a bright spot you'll find them in the financial stocks and you'll find them in utilities not necessarily A Harbinger here of further broad market gain Scarlet yeah you really had to look for some gainers but I did um failed to find one and I thought I should have in abami and fit because it had beaten a raise on the top line but that was not enough to impress investors mainly because abami fit has almost doubled this year it's consistently topped estimates and investors hold it to higher standards than most retailers uh the negatives in the earnings report were that gross margin was slightly below estimates um and super micro computer down 19% after saying it's delaying its annual Financial disclosures after short seller Hindenberg research published a fairly critical report on the company and of course we can't get too far away from Nvidia uh it is moving in after hours trading by not a whole lot down a quarter of a percent in contrast to the options which indicate much larger moves once the earnings hit yeah that could change in a big way in just a few minutes right now though one of the biggest movers in after hours trade is a firm those shares up about 15% here on the back of its earnings report here $659 million in Revenue in its most recent quarter that's its fiscal fourth that's a beat is still posting a loss of about 14 cents a share but that is actually better than what the street had anticipated here and here's your guidance the company is saying that it sees fiscal 2025 gross merchandise volume above $ 33.5 billion the street was looking for 33 billion so basically it's guiding Scarlet above what the street was looking for for ful year gross merchandise volume uh and actually says uh that revenue for the most for the first quarter this is the quarter that it's in right now will also top estimates they're providing a range of 640 to 670 million the street was looking for 632 yeah this is one of the big buy now pay later vendors uh companies and so this really suggest the adoption of BNP well PL I now pay later uh among young people among consumers overall as the economy slows down further yeah a firm also saying expects to be profitable on a gap basis in the fourth quarter of this year something we don't hear about anymore I thought Gap was dead all right we are keeping an eye on another stock and that is a Salesforce those shares higher here in after hours trade that company beating on several metrics in the most recent quarter and providing guidance for the quarter and the year that is trending also above what the street was looking for anoro R out in Chicago over at Bloomberg intelligence joining us now and hok what was kind of the more consequential thing we learned out of the earnings report from Salesforce I think the most consequential thing I learned was things are not really getting worse at this point and they were marginally better and that's actually good news because we have seen from you know companies like workday that clients are really not adding a lot more seats and there is pressure on uh your traditional software businesses at this point as clients are moving a lot more of their funding towards you know buying gpus exactly and of course Nvidia results we're still awaiting those in about uh five six minutes um talk a little bit about actives Investors and how they've changed the focus of Salesforce certainly to focus on profitability and straying away from its previous um strategy of buying growth yeah I think that is single biggest thing that we have seen improved over the last two years and you can give the you know outgoing CFO some benefit there because she has done such a good job of you know managing margins uh company's margin structure has changed completely uh you know in in part because of the activist pressure um there were some rumors about m&a and that is slightly concerning but other than that I think Salesforce is in the right trajectory in terms of profitable growth um and if when we assume we if if tech spending comes back next year then we would assume the top line to improve as well uh this might be a weird question hog but has there been any issue with Salesforce maybe losing some of that corporate spend to all the hype around Ai and all the sort of anciliary things that go with it yeah definitely I mean that is the big story here for all the top software companies is if you're really not a pure play AI company then you are losing that funding towards you know people buying chips or Microsoft processing more transactions on their Cloud um you know companies like workday and Salesforce have suffer because of that all right honor really appreciate you're joining us for the latest on Salesforce hog R of Bloomberg intelligence HP also reporting earnings let's just give you the numbers here third quarter net revenue 13.5 billion doar beating the consensus estimate of 13.37 billion in terms of its Outlook it sees F year adjusted EPS of $335 to 345 that is a higher range than what it previously anticipated of 330 to 360 and uh at the high end it matches the average analyst estimate of 345 the stock however lower by 5% after our was trading remain even after it uh boosted its share buyback authorization to10 billion yeah fire HOSA earnings coming out here in the after hours trade as we continue to wait on Nvidia we did get a results though out of a couple of key cyber security companies including crowd strike OCTA also out with its earnings as well M deep sing at Bloomberg intelligence joining us now in studio 2 let's start with crowd strike because of course they had a little bit of an incident uh a few weeks ago here what did you make of the results and more importantly the response to what happened yeah I mean everyone was expecting they'll give uh a much lower guide for the second half reset expectations well they haven't done that they told us it'll be 30 Mill million dollar impact for the next two quarters so net net it's like 150 basis points in Topline Revenue that they expect from the outage but other than that they are sticking to their guide which I'm surprised by honesty because this was a big event if Delta is saying they had a $500 million impact there are other customers like that and they clearly seem to uh be downplaying you know what customers may be claiming uh down the line why why do you think that is is it because of the after Sal service that crowd strike is providing its customers I think that has to do with it remember they are the category leaders in endpoint Cloud security so clearly they had a very good Market position and they were able to convince some of their customers and maybe they have got insurance you know for uh the incident but uh the initial hunch that I had was given the magnitude of the losses some of these customers had uh the insurance isn't going to cover all those losses and so they are better off sandbagging the half guide clearly they're not doing it and they are still sticking to you know the 25 to 30% Top Line growth those shares getting a little bit of a boost and after I was trade I want to talk about OCTA because those Shares are actually moving lower here kind of explain what's going on with this company well so if you roll back six quarters they also had a security incident to their systems and they never recovered since then the Topline growth has been decelerating and even till date it's been the estimates have been coming down and uh that's what I'm surprised by the president suggests that when a company a security company has an incident like this it takes at least a few quarters to recover from that so if frout strike is suggesting they're already thinking about a rebound and you know there won't be much impact I'm honestly surprised by their guide okay because you don't you think maybe we could see a repeat of what happened with OCTA maybe I mean and octa's event wasn't even of this magnitude even though you know it wasn't an outage it was more of a security event but it wasn't of this magnitude all right we're going to have to leave it there man deep Singh always appreciate him jump on uh to cover these earnings as soon as we get them of course the best of Bloomberg intelligence our thanks to honor Ro r as well as now the clock officially ticks down to those results out of Nvidia we're expecting to get them uh any minute now scarlet and to say that the palpitations are extreme would be an understatement yeah absolutely and I think um we have to keep in mind as much as there are consensus estimates there are definitely whisper numbers that are being bandied about here uh we heard from Daniel Morgan earlier that the third quarter Revenue Outlook which is for this quarter um he's hearing a whisper number of 33 to 34 billion even though the consensus estimate is for 31.9 billion so just under 32 billion that will be critical yeah it will be critical and it gets to this idea too of what are the expectations I mean when you have a company that was growing you know 300% then 200% now this quarter is going to be 100% which under any other circumstance would be phenomenal but of course people want more and people want growth and how much of that growth has already been priced in yeah and you get harder comparisons going forward too so that deceleration will continue Nvidia earnings now crossing the wire and here's your number it is a $30 billion number on the top line revenue in the most recent quarter $30 billion even the street was looking for 28.87 if you want to be precise adjusted EPS 68 cents a share gross margin 75.7% that's a beat of what the street was looking for the company also saying that for the third quarter the quarter that we're in right now it expects to post get this Scarlet $ 32.5 billion do in Revenue plus or minus 20% that is well above what the street was looking for which was roughly around that 31.9 billion number so if it gets that number or gets the plus 2% certainly a big beat there the company also approving $50 billion in share BuyBacks right but the whisper number is the number that maybe we should be looking at and uh yes even with that increased uh forecast it's not at that 33 or $34 billion perhaps with that plus or minus 2% you get closer to that but it's not quite at a 33 handle or 34 handle the stock moving up marginally in after hours trading right now and it's all about the forecast and whatever it says about Blackwell uh in during the conference call as well so uh keeping an eye here on Nvidia shares let's now bring in Antoine shakan he is technology infrastructure analyst over at New Street research he has a buy rating on the stock uh Antoine what do you see in these results that um perhaps are encouraging when it comes to the Outlook um thanks thanks for having me I would say the results are directionally aligned uh with our expectations uh I would say it was actually uh legitimate to expect Nvidia to do better than they guided three months ago uh and guide above expectations as well for the next three months on one hand you have hyers scalers who are increasing capex uh revisions keep going up um on the other hand you have supply chain that is increasing capacity steadily you know we have data points on the Coos front we have data points on the hbm front so all that actually lined up very well um and tells us that actually it's reasonable to expect a media to keep beating uh for the foreseeable future um now the question is what happens Beyond 2025 and and I don't think we'll have any visibility on that uh any anytime soon okay well let's give you some commentary from the company on when it comes to Blackwell Nvidia saying that Blackwell samples are shipping to Partners and customers and anticipation for Blackwell is incredible I know that doesn't begin to give us any numbers to work with here but given that there were reports Antoine of some delays and design issues with uh Blackwell do you see enough demand for the hopper chips the current generation chips to kind of make up for the uh elevated expectations for Blackwell yes so I I so nvidia's numbers are in Nvidia beat EPS by 19% beat Revenue by 177% we'll do a deep dive on there financials but we can see Nvidia is dumping here so Nvidia is dumping and it's headed towards that 11125 as of now right so interesting to see what takes place nvidia's dumping AMD is dumping hard avago's dumping hard here uh SMH is dumping in video's at 115 the risk in ships in video is at 115 right now and spy currently is at 555 Q's are at F 467 and Dow's holding up so this is how it looks intraday higher time frame so I'm interested to see if mvid can work its way back into that 11125 right full disclosure I have no positions too risky for me to really trade or engage it can easily get bought back up off of these lows and Skyrocket as well uh let me see if I can find the numbers here once I find the numbers we'll look over them before the earnings call window those chips and so you have the hypers scalers in particular Microsoft in particular whether we start hearing from these companies tangible monetization and we've done a lot of work actually trying to evaluate where those chips are getting deployed today are they deployed in the public Cloud are they deployed for internal use cases are they deployed to um Help U AI startups train Foundation models uh and I think we we're going to start to to to hear and see convincing arguments that these chips are getting deployed uh in ways that are going to start driving revenues and I don't think something will will hear right now I think this is something that's going to be much more Progressive over the next few quarters it's interesting in the release too and in the investor presentation on their website Antoine they kind of lay out a lot of the things they are trying to do to sort of I guess diversify product Revenue they talk about uh doing more Fab work uh and a few other things as well I mean you're looking at the revenue this is still a data center driven company $26 billion are their revenue so the Lion Share of it they're still getting about3 billion from gaming and then after that it drops off do you want to see more diversification in product lines do you want to see more diversification in strategy are you happy with this data center all-in strategy so I think we we can see diversification actually within data center we can see diversification within data center uh on the customer front at the moment you know that hypers scalers like a handful of companies actually account for about half of nvidia's revenues we expect you know diversification to happen on the customer front there we we expect C2 clouds to represent a more significant portion of uh data center revenues we expect uh Cloud you know like Sovereign AI to actually represent also an incre an increasing portion we expect Enterprises uh like apple uh like Biden uh and others to actually start ramping significant clusters as well and so that's one thing I would say then of course you have uh gaming and Automotive who that that that keep growing Automotive probably presents a significant opportunity but it's probably not something that's going to impact the stock in anywhere in the near term all right uh gonna have to leave it there uh Antoine really appreciate you jumping on uh to help us break down these earnings in real time antoan shag been over at New Street research uh and which you just point out we are going to have a special interview and special coverage later tonight A sitdown with the Nvidia CEO Jensen Wong that's going to start at 6:30 p.m. Eastern Time right here on Bloomberg as we see in viia shares uh now uh deeper in the red here they were down as much as 4% now down about 2 to 3% but you know what's phenomenal to me scarlet 384 million shares have swapped hands right now on the back of this earnings report that's the conference call hasn't even begun yet we haven't even heard the the gist the bulk of the comments from the CEO on on their Outlook and how they put it together in a narrative and we talk about sort of the broader Market effects here you are seeing uh Futures overall be dragged down by this also seeing some peers like AMD arm TSM and a few others also moving lower here stick with us we continue our coverage of nvidia's earnings a conversation with Dan Newman CEO of futurum that's coming up next right here on the close on [Music] Bloomberg want ethereum in your portfolio look for eth grayscale ethereum mini trust lowcost exposure to the second largest cryptocurrency from grayscale the crypto specialist type eth into your investment account today eth grayscale ethereum mini trust crypto investing begins here [Music] [Music] the biggest ideas Inspire new ones 30 years ago State Street created an ETF that inspired the world to invest differently it still does what can you do with [Music] spy the Mr Cool D iy is America's only DIY heat pump you simply drill stack and twist and then get your Chill on the system is hyper efficient and built to heat and cool in any and all climates plus it's smartphone compatible thousands Nationwide have spoken the Mr cool DIY is the heat pump for the true diyers get a three Zone DIY heat pump system today at low.com [Music] [Music] Nvidia earnings are out out here a beat on the most recent quarter though the forecast that the company gave uh maybe not quite what investors had expected you're still talking about a company sitting on $30 billion of quarterly Revenue but as we know where the company grows as much as it has over the last two years sometimes enough is Never Enough Daniel Newman joining us right now the CEO of the futurium group to talk a little bit more here I guess maybe about the longterm prospects for this company I mean look Dan if you need a chip that can sort of power these data servers that can sort of be at the focal point of what you need to Crunch these numbers to be at the center of AI you have to go to Nvidia that's going to change at some point they're going to have competitors and they're going to have meaningful competitors how soon do you think we're going to start to see that competition Nvidia is off to a fast start and of course more than a decade of research and investment that went into building this platform it wasn't just Hardware you're not buying a GPU you know you're buying a system they're putting it all together the software the libraries the Frameworks and they've made AI accessible enabling developers to write programs to this Hardware that's really powered this whole movement but let's be honest uh Roma uh AMD is going to enter the fry in a big way we're seeing what Lisa Sue is doing and of course we're seeing every hyperscaler whether that's AWS with inferencia and tranium whether that's Microsoft Maya Google's training its newest Gemini models on its TPU they all want to enter The Fray they understand the importance of building this vertical integration but I do think it's going to slow so you know this was a clean quarter uh Nvidia did what it said it would do but the market doesn't want 100% they want 150 200% acceleration of growth okay the numbers are in so let's go over the numbers so Revenue came in above uh q1 we look at I guess what q1 q1 we got 26 but also some of the F current quarter 30 billion gross margin 75 78 so slight di in the gross margin slight increase in operating expenses as Nvidia doesn't necessarily have an AMD or tsmc or some other company inome comparable chips this is still their so let's take it from the top so recorded revenue of 30 billion up 15% from q1 and up 122% from a year ago 122% from a year ago recorded Curr quarterly data center revenue for 263 billion up 16% from q1 and up 154% from a year ago whenever a company starts referring to their numbers from a year ago from a few quarters ago then they want you to emphasize on the or focus on the bigger picture and start looking at these longer time Horizon you know become the killer workload rather than so much focus on training different architectures of chips meaningful role in this AI um you know this AI buildout so I see it both ways I think for the next three or four quarters in so I'm really interested to see what they have to say what they have to say uh what they have to say on the earnings call what Jensen has to say on earnings call so stay tuned into that make sure to like guys make sure to like the video subcribe back for a moment to what investors are reacting to right now which is the outlook for this current quarter quarter third quarter of25 billion plus or minus 2% uh the consensus estimate was for $ 31.9 billion so just under $32 billion which would already be a 76% jump versus last year the highest estimate though was just under 38 billion dollar So Daniel when we look at a company like Nvidia and the kinds of stock moves it's had of 160% this year up uh 35% since its last earnings report you know investors want to see it delivering in in every way on all cylinders is it a case where anything other than the highest estimate would just automatically get some kind of a a pull down and in order for the stock to to you know attract investors once again the commentary on the conference call really has to outperform yeah we've seen so many quarters in a row where they've come and beaten substantially above even what that sort of guide was and and over the past several quarters we're starting to see you know the deceleration quarter on quarter and year on year and that's because they've had those massive three and 400% growths yeah um now what we're really up against is you know we are up against whether or not this is sustainable do investors want to get out after making thousand plus percent returns are they looking at this and saying maybe we'll let it cool we'll let it breathe um and I said this coming into the quarter Scarlet there was no result other than perfect that would probably create a big lift but there was a lot of downside not just for NVIDIA the whole Market if they didn't come up big and I I think Futures are showing that as well so Nvidia is really the only game in town right now when it comes to these AI chips to power data centers we know that Nvidia has pricing power and therefore it has margin power do you therefore look at the gross margin number as an accurate gauge of demand for NVIDIA chips or is it not all that sensitive because the pricing is is not Dynamic yeah I think I think the margin power is indicative of the influence that Nvidia has of course you know it has its large Partners it's Building Systems not gener not necessarily selling just a chip it's systems and these system margins are very high because the demand is is is substantial you know we're hearing everyone from open AI to you know to other smaller Enterprises and tier 2s having a problem getting access to the chips and systems that they need and therefore companies like meta X Tesla Microsoft Amazon taking all of that demand and it gives them great pricing power I don't think until AMD really starts to see acceleration in its business and then to some extent when these hyperscalers start to really see growth in their homegrown platforms is NVIDIA going to be under substantial pressure to to play in the pricing battle but I do think over probably four to eight quarters we're going to see some pressure on margin and that is going to be something to watch yeah uh absolutely and we should point out uh our team here that's been crunching all these numbers in there now pointing out this is the smallest Topline beat that we've seen for NVIDIA in six quarters here nevertheless still again we always have to point out triple almost triple digit growth here uh which would normally uh be something to celebrate uh Dan you mentioned the hyperscalers I am curious about the end use use cases for AI because ultimately that will probably deter the longer term growth for NVIDIA and some of its peers here even past the hyperscalers when do you start to see a more meaningful use case for AI and a meaningful use case for AI that's actually going to be profitable for the companies doing it yeah we're starting to see them Roman we're seeing it with Walmart they announced some pretty substantial efficiency gains in their systems just in this most recent quarter we heard Andy jasse talking about some of their code development and the efficiencies talking about you know years of developer time that was able to be reduced because it was um because of what they've been doing with with generative AI tools for code development but that is exactly where my head is at too man I mean building this into Salesforce instances you know they had their earnings today Mark beno's going to talk about this but companies and their CRM systems can they get better understanding of when customers are going to buy and getting them the right message and the right Channel at the right time and using generative tools to do this we all want to see this digestion of all this capex turn into really meaning consumption on the Opex side and that's happening more slowly I I've been saying to the market that I think this is a four to even 12 quarter lag depending on Industries we are getting value out of AI so that's also kind of a misconception we've been using AI algorithms are four decades old we've been optimizing Bloomberg's been using it in its own assessments for a long time but generative tools need to bring more value and we need to understand monetization better in these next quarters for more of these software and SAS and other businesses as opposed to just betting blindly which is what so many people have been doing Daniel really appreciate it Daniel Newman is CEO of the futurum group and of course as we look at Nvidia shares decline in after hours trading just a reminder that we have a special edition of blueberg Technology we've got an interview with Jensen hang the CEO and co-founder tonight at 6:30 p.m. eastern time in the meantime it's worth revisiting uh that markets were down equities were down in the leadup to these results the S&P 500 lower the NASDAQ 100 lower by even more not much movement in treasuries or the dollar for that matter up slightly by a third of 1% but um right now the setup rain is that at least heading into the earnings call that it did not deliver the heist to the highest expectations yeah we'll see what that effect is on the cash session we should point out that right now S&P futures are down more than 10 points from where they closed out the cash session and the NASDAQ futures down significantly more than that down about 100 points or so so it'll be interesting to see oh there you have it there on your screen there the S&P NASDAQ and for those folks that they still follow at the Dow futures and this will be of course the big story in in the morning here is just how much of a drag Nvidia has on the broader Market more coverage coming up stick with us this is the close on Bloomberg good morning from our well headquarters in New York I'm Manis cranny and I'm Danny Berger let's set your agenda Bloomberg brief delivers the market news data and Analysis you need live every weekday at 5:00 a.m. eastern Bloomberg come context changes everything we want to make sure that we're exposed to categories that continue to be relevant to Consumers that were positioned in categories where we have a competitive right to win by strategically adding and shedding assets General Mills has turned over about 20% of its net sales base in the last 6 years it's dramatically expanded its pet food platform starting with the purchase of Blue Buffalo pet products in 2018 that expansion dovetailed with a boom in demand pet in the US pet feeding and treating is a $50 billion category it's almost five times the size of a category like cereal is this the future of the company I mean we so much associate General meals with breakfast and cereals human breakfast and human cereals are we now going to be thinking about General Mills much more as a pet food company I think You' be thinking about General Mills as a food company where we treat all the members of the family like family the humanization of pets is actually the biggest driver of pet food and pet treating growth it has derivatives in not only feeding which is the core thing that you you know most households where that most of the dollars go against the against the pet but but treating and then you start to Branch out to things like U vitamins and minerals and supplements people really love their pets they want to take care of their pets like they do their family and it really is a global phenomenon that's why we recently entered the China Market with Blue Buffalo that's why we bought Edgard and Cooper recently in Europe because we see the same kinds of trends that have played out here in the US playing out all over the world World Bloomberg covers the world with unmatched reach and resources from more than 120 countries the moment news breaks 24 hours a day Bloomberg context changes everything up to the minute political news whenever and wherever it happens I'm Joe Matthew at the Democratic National Convention in Chicago and this is Bloomberg [Music] we continue to keep a close eye on shares of Nvidia and we will get back to that story in a minute but you'd be remiss and not pointing out of course that this is still a macro driven market and one that actually could be driven in a big way over the next couple of days we do get quite a few E points of economic data including a revision on GDP numbers tomorrow and on Friday the fed's preferred measure of inflation is Du out core pce that is expected to hold at 0.2% on the month over month basis a big question now as to what that will mean for the fed's rate cutting dreams Tiffany Wilding joining us right now Economist over at Pimco to talk a little bit more about this and before we get into the numbers uh of these specific data points I'm wondering kind of what your broader assessment is right now of the economic enir environment against this backdrop of what the market is expecting which is several rate Cuts over the next three months yeah know I I mean I think if you really just zoom out I think what we're seeing is a US economy that is is getting back to you know some semblance of normal after the very unique set of economic shocks that we saw post pandemic so again if you just zoom out you look at headline inflation levels we are pretty close to the to ranges that where we were pre pandemic if you look at labor market indicators including the unemployment rate or if you look at the job openings to unemployed ratio we are back to levels where we were in 2019 if you look at measures of wealth in the economy which exploded post pandemic real wealth is now back to levels that we were uh in 2019 you know measures of supply chain stress are back to where we were in 2019 you look at inflation expectations they've remained well anchored throughout this whole episode so I think if the question is if we're kind of getting back to you know more of a prepandemic type of economy why are we not um closer to a pre-pandemic level of interest rates uh from the Federal Reserve so you know all of that is to say is that you know policy is restrictive you know given underlying economic conditions Central Bankers pal clearly knows this I think that the the way you know the way he communicated at Jackson hle he was very clear that the FED is moving towards neutral they need they know they need to get there uh and and the question now is is more about the pace um you know than it is um whether they're going to get go there or not but there is also a question about what neutral is I mean I I I like the fact that you s uh sort of talked about how we've kind of renormalized if you will back to some of those pre-pandemic levels but does that necessarily mean that interest rates have to go back to those pre-pandemic levels because there are a lot of fed members that will say that what we had back then was not normal yeah I mean and and I I certainly I I definitely take that point and that's something for sure that Federal Reserve members will have to try to understand and estimate in real time as they're reducing policy um and and I certainly is a is a reason why absent a recession if we are not in a recession you know that they can still take some time to get back to you know levels closer to what they estimate is neutral you know knowing those estimates are uncertain so I think that's what they're thinking they're going to do um I do think you know you bring in the distribution of risks here you know I think that also matters you know the fact that as pal suggested just infl upside inflation risks have moderated um you know and and there there are uh signals within the labor market uh report within the labor markets you know that do suggest that labor markets have have eased quite a bit and obviously you know usually those things have momentum that builds on each other at least they have have had historically so when you see an unemployment rate that moves up over 50 basis points that tends to result in in a bigger move up in the unemployment rate So within that balance of risks you know we would still argue the FED has some room here you know to start cutting interest rates see how the economy responds and then revise their level or their estimate of neutral you know as they do that so a gradual methodical approach here to policy and how it uh how the Great Cuts the uh loosening of monetary policy um gets handled how in sync is the bond market and fed policy makers now when it comes to the outlook for rate cuts for not just this year the rest of this year but next year yeah well I mean if you if you again think about you know kind of just the distribution of risks here um you know the the sep forecast is a modal expectation it's the most likely expectation um and Federal Reserve officials themselves have suggested that you know really the risks around the inflation and the unemployment rate goal would suggest that if anything the risks to that uh policy rate forecast are to the downside um and so you know I think what the market you know is is kind of pricing right now is is we kind of have this modal expectation that as you said things will be methodical and how they get down but but there's always a range of scenarios right that the markets will press and there's certainly the risk that uh they could get there a little bit faster than that or of course in the case of a recession you know a lot faster so you know again I think that's kind of what the markets are pricing you know overall when we look at valuation across the bond market you know we still see a lot of value despite the uh you know the recent rally you know if you look at fiveyear fiveyear real interest rates for example at Route 170 you know they're still well above levels that we think are more consistent with with real neutral interest rates um you even if they are a little bit higher thankk you for tuning in everyone make sure to like make sure to subscribe we are minutes away from the live earnings call we can see that Nvidia did initially push lower was down about 4 to 5% brought back up off those lows now looks like it's rejecting once it got back into that 120 123 range semiconductors all of them are essentially bouncing off their bottoms spy isn't doing much in premarket outside of that uh larger move it did have the downside inial reac moments away from earnings call so stay tuned enjoy if you have any questions drop it in the chat make sure to like and make sure to subscribe than what you see with you know a 10 year uh 10e bond yield or what have you but you're not going to get that 5% overnight rate forever right as as as the Federal Reserve starts dropping interest rates your the yield that you're getting uh will also drop quite quickly so you know investors need to take that into consideration I think the other thing that people need to remember as well is that you know again I I said around a range of scenarios the bond market does well um if you are in cash the C you know that kind of money market type of investment you know is not necessarily going to give you as good of a hedge against uh you know a recessionary scenario or a scenario that where the uh economy deteriorates more than expected um and you're not going to get those hedging benefits so you know moving out into like the Intermediate part of the interest rate curve is where we like to be we think it's a sweet spot we see a lot of value there uh and and it gives you these nice hedging properties as well Tiffany always appreciate you're joining us Tiffany Wilding is Economist at Pimco the bond shop joining us from California thank you so much there is some breaking news here that has nothing to do with chip companies OR tech companies it's Big Lots old school retailer the off price HomeGoods retailer is contemplating a potential bankruptcy filing after years of sales declines this is according to people familiar with the matter romae we also know Big Lots is potentially seeking investors in order to avoid chapter 11 as well yeah I mean this is a company that's been on the road I was just taking a look at it I mean we're talking about a stock that's basically down 99% from its all-time high that was really just about three years ago and this was a stock that was 72 bucks a share and now basically uh closing out the day around 73 cents and you see the drop down uh there I mean it gets to the point here of like how does a discount I mean we talked so much about how Costco is doing well Walmart's doing well why is this discount retailer somehow was not able to get out of its own way and make money like the way the others did maybe it doesn't have the right suppliers it's not getting the right goods and inventory to be able to um attract the the consumer those shares down about 33% here in the after hours trade of course Invidia also oscillating between gains and losses still soft we're going to set you up here for some of the big Market moving events over the next 24 hours when we come back this is the close on Bloomberg [Music] the biggest ideas Inspire new ones 30 years ago St Street created an ETF that inspired the world to invest differently it still does what can you do with spy [Music] [Music] all right investors continuing to try to make sense of nvidia's after hours trading following his latest earnings report stock currently down about 4% they'll be hanging on to every word of CEO and co-founder Jensen hang this evening when he speaks exclusively with Bloomberg television so joining us now with more on that conversation is Bloomberg technology co-host Ed lllo Ed congratulations on getting the interview what will you be what what's number what's first on your mind when you speak with Jensen hang when it comes to uh this Outlook which uh failed to meet the highest expectation yeah it's never enough is it I think Blackwell so Nvidia has this commitment to bring a new generation of AI accelerator to Market every year annually and they told us two things one they did make a design change uh which impacted their initial production which will ramp starting in the fiscal fourth quarter of uh and then ramp into fiscal year 26 this is the fiscal year 25 they just reported and they said that in that School fourth quarter there will be several billion dollars of sales of this Cutting Edge chip but it's not enough what does several billion dollars mean give us a dollar figure who's buying it who will get it first at what scale will they adopt it all these kinds of things is what the Market's crying out for he give us a sense here Ed I know they don't talk a lot in the release and in the presentation about competition and I know that competition is still relatively nent but I do want to hear if I can just give you a question to ask Jensen for me I I I am curious as to whether it's at least on his radar if he's watching AMD watching TSM watching some of these other companies and what they're trying to build and is he worried at all or should he be well when last I checked I think AMD is the most significant decliner after hours in terms of the peers I think it was down 1% you made a really interesting observation earlier which is that basically Nvidia just has five customers right the hyperscalers and meta those hyperscalers are a working on their own silicon but they also do Benchmark and have specific use cases for other AI accelerators for example AMD would very proudly boast other of those names using its AI accelerator the issue is just the scale Nvidia will do hundred billion dollar of sales this year amdd will do 4 and a half billion they just haven't been able to catch up in deploying that technology into the real world all right well of course uh this is still obviously the most consequential stock and really the most consequential story for the broader Market maybe even for the economy that we've had in quite some time and Ed llo is going to have a chance to sit down with the man at the center of all that Nvidia CEO Jensen Wong going to be joining Bloomberg a little bit later today special coverage starts at 6:30 p.m. New York time with Ed llo be sure to tune in for that meanwhile there are some other potentially Market moving things out there if you care uh about them uh and it starts tomorrow morning with more earnings not quite as consequential as Nvidia but maybe some insight into the economy yeah and insight into the consumer as well right Dollar General Best Buy American Eagle Burlington store so it kind of runs the gamut in terms of product and price point and then afterm Market um a turnaround story which is still in turnaround mode which is Gap uh yeah still early early turnaround mode there but yeah good for them interesting to see I am curious to see what Ulta Beauty has to say uh there's been some concerns here that beauty isn't quite holding up as much as people thought War buff is not concerned we also get marel technology uh as well so another be on what's been going on good afternoon good afternoon everyone thank you for tuning in make sure to like make sure to subscribe we're a couple of minutes away from the conference call we're going to switch over to that once they do start talking and now we'll have the I believe the most amount of impact on Nvidia after hours so let's see we did get the numbers Nvidia did beat on EPS did beat on Revenue but the beat wasn't to the degree to to Mark the street anticipated again so thank you for tuning in we're going to flip over to the conference call once that's made available and I continue listening [Music] in 2015 I was not optimistic because nobody was working on the hard problems the energy R&D budgets had gone down the Venture investing in climate had gone down it was completely out of fashion so I don't know what people are optimistic about then the fact is we built essentially from scratch you know with lots of supporters a really mindblowing level of innovation again emissions and you know in the last nine years that's gone better than I would have expected so only now could you even you know plausibly be optimistic about the the path of emissions and someone who said Hey Nobody's ever scaled things up very like this the speed we knew to say hey I'll believe this one I see it you know in the meantime some people who care about this issue are really out you know trying to think do we need permitting reform you know do we find what new ideas haven't we found yet you know who how do we fund people with those those new ideas how do we get the cost of these things down how do we collaborate on a global basis uh so it's we're still not at the point where it's guaranteed or even that it'll it'll be easy but at least there's a theory of [Music] change good afternoon my name is Abby at this time I would like to welcome everyone earnings call all lines have been placed on mute to prevent any background noise after the speaker's remarks there will be a question and answer session if you would like to ask a question during that time simply press the star key followed by the number one on your telephone keypad if you would like to withdraw your question press star one a second time thank you and Mr Stewart stcker you may begin your conference thank you good afternoon everyone and welcome to nvidia's conference call for the second quarter of fiscal 2025 with me today from Nvidia are Jensen Wong president and chief executive officer and Colette cres Executive Vice President and Chief Financial Officer I would like to remind you that our call is being webcast live on nvidia's investor relations website the c will be available for replay until the conference call to discuss our financial results for the third quarter of fiscal 2025 the content of today's call is invidious property it cannot be reproduced or transcribed without prior written consent during this call we may make forward-looking statements based on current expectations these are subject to a number of risks significant risks and uncertainties and our actual results May differ materially for 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 10K and 10q and the reports that we may file on Form 8K with the Securities and Exchange Commission all our statements are made as of today August 28 2024 based on information currently available to us except as required by law we assume no obligation to update any such statements during this call we will discuss non-gaap Financial measures you can find a Reconciliation of these non-gaap Financial measures to Gap Financial measures in our CFO commentary which is posted on our website let me highlight an upcoming event for the financial Community we will be attending the Goldman Sachs communic copia and Technology conference on September 11th in San Francisco where Jensen will participate in a keynote fireside chat our earnings call to discuss the results of our third quarter of fiscal 2025 is scheduled for Wednesday November 20th 2024 with that let me turn the call over to Colette thanks Stuart Q2 was another record quarter revenue of 30 billion was up 15% sequentially and up 122% year on-ear and well above our Outlook of 28 billion starting with data center dat Center revenue of 26.3 billion was a record up 16% sequentially and up 154% year onye driven by strong demand for NVIDIA Hopper GPU Computing and our networking platforms compute Revenue grew more than 2.5x networking Revenue grew more than 2x from the last year cloud service providers represented roughly 45% of our data center Revenue and more than 50% stem from the consumer internet and Enterprise companies customers continue to accelerate their Hopper architecture purchases while gearing up to adopt Blackwell Key workloads Driving our data center growth include generative AI model training and inferencing video image and Text data pre and post processing with Cuda and AI workloads synthetic data generation AI power recommender systems SQL and Vector database processing as well next Generation models will require 10 to 20 times more compute to train with significantly more data the trend is expected to continue over the trailing four quarters we estimate that inference drove more than 40% of our data center Revenue csps consumer internet companies and Enterprises benefit from the incredible throughput and efficiency of nvidia's inference platform demand for Invidia is coming from Frontier Model makers consumer internet services and tens of thousands of companies and startups building generative AI applications for consumers advertising education Enterprise and health care and Robotics developers desire nvidia's Rich ecosystem and a avilability in every cloud csps appreciate the broad adoption of Nvidia and are growing their Nvidia capacity given the high demand Nvidia h200 platform began ramping in Q2 shipping to large csps consumer internet and Enterprise companies the Nvidia h200 builds upon the strength of our Hopper architecture and offering over 40% more memory bandwidth compared to the h100 our data center Revenue in China grew sequentially in Q2 and a significant contributor to our data center Revenue as a percentage of total data center Revenue it remains below levels seen prior to the imposition of export controls we continue to expect the China Market to be very competitive going forward the latest round of M perf inference benchmarks highlighted nvidia's inference leadership with both Nvidia Hopper and Blackwell platforms combining to win gold medals on all tasks at computex Nvidia with the top computer manufacturers unveiled an array of Blackwell architecture powered systems and Nvidia networking for building AI factories and data centers with the Nvidia mgx modular reference architecture our oems and M partners are building more than 100 Blackwell based systems designed quickly and cost effectively the Nvidia Blackwell platform brings together multiple GPU CPU dpu NV link nvlink switch and the networking chips systems and Nvidia Cuda software to power the next generation of AI across the cases Industries and countries the Nvidia gb200 NBL 72 system with the fifth generation NV link enables all 72 gpus to act as a single GPU and deliver up to 30 times faster inference for llms workloads and unlocking the ability to run trillion parameter models in real time Hopper demand is strong and Blackwell is widely sampling we executed a change to the Blackwell GPU pass to improve production yields Blackwell production ramp is scheduled to begin in the fourth quarter and continue into fiscal year 26 in Q4 we expect to sip several billion dollars in Blackwell Revenue Hopper shipments are expected to increase in the second half of Fisco 2025 Hopper Supply and availability have improved demand for Blackwell platforms is well above Supply and we expect this to continue into next year networking Revenue increased 16% sequentially our ethernet for AI Revenue which includes our Spectrum X endend ethernet platform doubled sequentially with hundreds of customers adopting our ethernet offerings Spectrum X has broad Market support from OEM and odm partners and is being adopted by csps GPU H providers and Enterprise including xai to connect the largest GPU compute cluster in the world Spectrum X supercharges ethernet for AI processing and delivers 1.6x the performance of traditional ethernet we plan to launch new Spectrum X products every year to support demand for scaling compute clusters from tens of thousands of gpus today to millions of gpus in near future Spectrum X is well on track to begin a multi-billion dollar product line within a year our Sovereign AI opportunities continue to expand as countries recognize AI expertise and infrastructure at National imperatives for their society and industries Japan's National Institute of advanced industrial science and technology is building its AI bridging Cloud infrastructure 3.0 supercomputer with Nvidia We Believe Sovereign AI Revenue will reach low double digigit billions this year the Enterprise AI wave is started Enterprises also drove sequential Revenue growth in the quarter we are working with most of the Fortune 100 companies on AI initiatives across Industries and geographies a range of applications are fueling our growth including AI powered ch SPS generative Ai co-pilots and agents to build new monetizable business applications and enhance employee productivity amdoc is using Nvidia generative AI for their smart agent transforming the customer experience and reducing customer service cost by 30% service now is using Nvidia for its now assist offering the fastest growing new product in the company's history sap is using Nvidia to build jewel co-pilots cohesity is using Nvidia to build their generative AI agent and lower generative AI development costs snowflake serves over three billion queries a day for over 10,000 Enterprise customers is working with Nvidia to build co-pilots and lastly withdrawn is using Nvidia AI Omniverse to reduce endtoend cycle times for their factories by 50% Automotive was a key growth driver for the quarter as every automaker developing autonomous vehicle technology is using aidia in their data centers Automotive will drive multi-billion dollars in Revenue across on Prem and Cloud consumption and will grow as Next gener Generation AB models require significantly more compute Healthcare is also on its way to being a multi-billion Dollar business as AI revolutionizes Medical Imaging surgical robots patient care electronic health record processing and Drug Discovery during the quarter we announced a new Nvidia AI FL Foundry service to Ser supercharge generative AI for the world's Enterprises with meta's llama 3.1 collection of models this marks a watershed moment for Enterprise AI companies for the first time can Leverage the capabilities of an open-source Frontier level model to develop customized AI applications to encode their institutional knowledge into an AI flywheel to automate and accelerate their business Accentra is the first to adopt the new service to build custom llama 3.1 models for both its own use and to assist clients seeking to deploy generative AI applications Nvidia Nim accelerate and simplify model deployment companies across Healthcare energy Financial Services Retail transportation and Telecommunications are adopting Nims including aramco Lowe's and Uber at& realized 70% cost savings and eight times latency reduction after moving into Nims for generative Ai call transcription and classification over 150 partners are embedding NS across every layer of the AI ecosystem we announc Nim agent blueprints a catalog of customizable reference applications that include a full Suite of software for building and deploying Enterprise generative AI applications with Nim agent blueprints Enterprises can refine their AI applications over time a datadriven AI flywell the first Nim agent blueprints include workloads for customer service computer aided drug Discovery and Enterprise retrieval augmented generation our system integrators technology solution providers and system Builders are bringing Nvidia Nim agent blueprints to Enterprises Nvidia Nim and Nim agent blueprints are available through the Nvidia AI Enterprise software PL platform which has great momentum we expect our software SAS and support Revenue to approach a$2 billion annual run rate exiting this year with Nvidia AI Enterprise notably contributing to growth moving to gaming and AIP PCS Gaming revenue of 2.88 billion increased 9% sequentially and 16% year on-ear we saw sequential growth in console no book and does help revenue and demand is strong and growing and channel inventory remains healthy every PC with RTX is an AI PC RTX PCS can deliver up to 1,300 AI tops and there are now over 200 RTX AI laptops designs from leading PC manufacturers with 600 AI powered applications and games and an installed base of 100 million devices RTX is set to revolutionize consumer experiences with generative AI Invidia Ace a suite of generative AI Technologies is available for RTX AI PCS mea break is the first game to use Nidia Ace including our small small large small language model minitron 4B optimized on device inference the Nvidia gaming in ecosystem continues to grow recently added RTX and dlss titles including Indiana Jones and the great circle Dune Awakening and Dragon Age The Veil guard the GeForce now Library continues to expand with total catalog size of over 2,000 titles the most content of any cloud gaming service moving to Pro visualization revenue of 454 million was up 6% sequentially and 20% year onye demand is being driven by Ai and graphic use cases including model fine-tuning and Omniverse related workloads automotive and Manufacturing were among the key industry vertical driving growth this quarter companies are racing to digital at workflows to drive efficiency across their operations the world's largest electronics manufacturer foxcon is using Nvidia Omniverse to power digital twins of the physical plants that produce Nvidia black ho systems and several large Global Enterprises including Mercedes ben Mercedes-Benz signed multi-year contracts for NVIDIA Omniverse Cloud to build industrial digital twins of factories we announced new Nvidia USD Nims and conectors to open Omniverse to new Industries and enable developers to incorporate generative Ai co-pilots and agents into USD workloads accelerating their ability to build highly accurate Virtual Worlds wpp is implementing usdm microservices in its generative AI enabled content creation pipeline for customers such as the Coca-Cola company moving to automotive and Robotics Revenue was 346 million up 5% sequentially and up 37% year onye year- on-year growth was driven by the new customer rants in self- thriving platforms and increased demand for AI cockpit Solutions at the consumer at the computer vision and pattern recognition conference Nvidia won the autonomous Grand Challenge in the end to end driving at scale category performing more than 400 entries worldwide Boston Dynamics byd Electronics figure intrinsic seens skilled ADI and paradine Robotics are using the Nvidia Isaac robotics platform for autonomous robot Farms humanoids and mobile robots now moving to the rest of the panl Gap gross margins were 75.1% and non-gaap gross margins were 75.7% down sequentially due to a higher mix of new products within Data Center and inventory Provisions for low yielding black ra material sequentially Gap and non-gaap operating expenses were up 12% primarily reflecting higher compensation related costs cash flow from operations was 14.5 billion in Q2 we utilize cash of 7.4 billion toward shareholder returns in the form of share repurchases and cash dividends reflecting the increase in dividend per sh our board of directors recently approved a $50 billion share repurchase authorization to add to our remaining 7.5 billion of authorization at the end of Q2 let me turn the outlook for the third quarter total revenue is expected to be 32.5 billion plus or minus 2% our third quarter Revenue Outlook incorporates continued growth of our Hopper architecture and sampling of our Blackwell products we expect Blackwell production ramp in Q4 Gap and non-gap growth margins are expected to be 74.4% and 75% respectively plus or minus 50 basis points as our data center mix continues the shift to new products we expect this trend to continue into the fourth quarter of fiscal 2025 for the full year we expect gross margins to be in the mid 70% range Gap and non-gaap operating expenses are expected to be approximately 4.3 billion and 3.0 billion respectively full year operating expenses are expected to grow in the mid to Upper 40% range as we work on developing our next generation of products Gap and non-gaap other income and expenses are expected to be about 350 million including gains and losses from non-affiliated Investments and publicly held Equity Securities Gap and non-gaap tax rates are expected to be 177% plus or minus 1% excluding any discrete items further Financial detail are included in the CLE commentary and other information available on our IR website we are now going to open the call for questions operator would you please help us and pull for questions thank you and at this time I would like to remind everyone in order to ask a question press star and then the number one on your telephone keypad we will pause for just a moment to compile the Q&A roster and as a reminder we ask that you please limit yourself to one question and your first question comes from the line of vivec Arya with Bank of America Securities your line is open uh thanks for taking my question um Jensen you mentioned um in the prepared uh comments that there's a change in the Blackwell GPU mask I'm curious are there any other incremental changes in backend packaging or anything else and I think related um you suggested that you could ship several billion dollars of Blackwell in Q4 despite a change in in the design is it because all these issues will be solved by then just help us size what is the overall impact of any changes in in Blackwell timing uh what that means to your kind of Revenue profile and how are customers reacting to it yeah thanks V uh the change to the mask is complete uh there were no functional changes necessary and so we're sampling uh functional sample of uh Blackwell Grace Blackwell in a variety of system configurations as we speak uh there are something like a hundred different types of Blackwell based systems that are built that were shown at comput text and we're enabling uh our ecosystem to start sampling those uh the functionality of Blackwell is as it is and we expect to start production in Q4 and your next question comes from the line of toshia Hari with Goldman Sachs your line is open hi thank you so much for taking the question uh Jensen I had a relatively longer term question uh as you may know there's a pretty heated debate in in the market on you know your customers and customers customers return on investment um and what that means for the sustainability of of capex going forward uh in internally at Nvidia like what what are you guys watching you know what's on your dashboard as you try to gauge customer return and and how that impact capex uh and then a quick followup maybe for Colette um I think your Sovereign AI number for the full year went up uh maybe a couple billion uh what's driving the improved Outlook and and how should we think about fiscal 26 thank you thanks toshia uh first of all when I said ship production in Q4 I mean shipping out I don't mean starting to ship but I mean I don't mean starting production but shipping out uh on the longer term longer term question let's take a step back and and you've heard me say that we're going through two simultaneous platform transitions at the same time the first one is transitioning from accelerated Computing to from uh general purpose Computing to accelerated Computing and the reason for that is because CPU scaling has been known to be slowing for some time and it is it is slow to a crawl and yet the amount of computing demand continues to grow quite significantly you could maybe even estimate it to be doubling every single year and so if we don't have a new approach Computing inflation would be driving up the cost for every company and it would be driving up the energy consumption of data centers around the world uh in fact you're seeing that and so the answer is accelerated Computing we know that accelerated Computing of course speeds up applications it also enables you to uh do Computing at a much larger scale for example scientific simulations or database processing but what that translates directly to is lower cost and lower energy consumed and uh in fact this week uh we there's a Blog that came out that that talked about a whole bunch of new libraries that we offer and that's really the core of the first platform transition going from general purpose Computing uh to accelerated Computing and it's not it's not unusual to see uh Someone Save 90% of their Computing cost and and um and the reason for that is of course you just sped up an application 50x uh you would expect the Computing cost to to uh decline quite significantly the second was enabled by accelerated Computing because because we drove down the cost of training large language models or training deep learning so incredibly that it is now possible to have gigantic Scale Models multi- trillion parameter models and train it on pre-train it on just about the world's uh knowledge Corpus and let the model go figure out how to understand uh human represent human language representation and how to codify knowledge into its neural networks and how to learn reasoning and so so uh which which caused the generative AI Revolution now gener generative AI uh taking a step back about why it is that we went so deeply into it is because it's not just a feature it's not just a capability it's a fundamental new way of doing software in instead of human engineered algorithms we now have uh data we tell the AI we tell the model we tell the computer what's the what are the expected answers what are our what are our previous observations and then for it to figure out what the algorithm is what's the function it learns a universal you know AI is a bit of a universal function approximator and it learns the function and so you could learn the function of almost anything you know and anything that you have that's predictable anything that has structure anything that um that you have um uh previous examples of and so so now here we are with generative AI it's a fundamental new form of computer science it's affecting uh how every layer of computing is done from CPU to GPU from Human engineered algorithms to machine learn algorithms and the type of applications you could now develop and and um uh produce is uh fundamentally uh remarkable and there are several things that are happening in generative AI so the first thing that's happening is the frontier models are uh growing in quite substantial scale and they're still seeing we're still all seeing uh the benefits of scaling and whenever you double the size of a model you also have to more than double the size of the data set to go train it and so the amount of flops necessary in order to create model goes up quadratically and and so it's not unus it's not unexpected to see that the Next Generation models could take 20 you know 10 20 40 times more compute uh than last generation so we have to continue to drive the generational um performance up quite significantly so we can drive down the energy consumed and drive down the cost necessary to do it so the first one is um uh there are larger Frontier models on more modalities and surprisingly they're more Frontier Model makers than last year and so you have more on more on more that's that's one of the Dynamics going on in gen generative AI the second is although it's below the tip of the iceberg you know what we see are chat GPT um uh image generators uh we see um uh coding we use we use uh generative AI for coding uh quite extensively here at Nvidia now uh we of course have a lot of digital designers and things like that um but those are kind of the tip of the iceberg what's below the iceberg are the largest systems largest Computing systems in the world today which are and you've heard me talk about this in the past which are recommender systems moving from CPUs it's now moving from CPUs to generative AI so recommender systems uh ad generation custom ad generation targeting ads at very very large scale and quite hyper targeting uh search and user generated content these are all very large scale applications have now uh evolved to generative AI of course the number of generative AI startups uh is generating tens of billions of dollars of uh Cloud renting uh opportunities for our Cloud Partners uh and uh Sovereign AI you know countries that are now realizing that uh their data is their natural and National resource and they have to use they have to use AI build their own AI infrastructure so that they could uh have their own digital intelligence uh Enterprise AI as Colette mentioned earlier is uh starting and uh you might have seen our announcement uh that uh the world's leading it uh companies are joining us to take the mvidia AI Enterprise platform uh to the world's Enterprises that the the compan companies that we're talking to uh so many of them are just so incredibly excited to drive uh more productivity out of their company and then and then General robotics the the big the big um uh transformation last year as we uh are able to now learn uh physical AI from watching video and human demonstration and synthetic data generation from uh reinforcement learning uh from systems like Omniverse uh we are now able to uh work with just about every uh robotics companies now to start thinking about start building um General uh General Robotics and so you can see that there just so many different directions that General AI is going and so we're we're actually seeing the the momentum of gener generative AI accelerating and toia to answer your question um regarding us Sovereign Ai and our our goals in terms of growth in terms of Revenue uh it certainly is a unique um and growing opportunity uh something that uh surfaced uh with generative Ai and the desires of countries around the world to have their own uh generative AI that would be able to incorporate uh their own language incorporate their own culture incorporate their own data in that in that country uh so more and more um excitement around these uh models and what they can be specific for those countries so yes we're see we are seeing some growth opportunity in front of us and your next question comes from the line of Joe Moore with Morgan Stanley your line is open great thank you um jinon in the fres release she talked about Blackwell anticipation being incredible um but it seems like Hopper demand is also really strong I mean you're guiding it for a very strong quarter without Blackwell in October so you know how long do you see of coexisting strong demand for both and can you talk about the transition to Blackwell do you see people intermixing clusters do you think most of the Blackwell activities new clusters just some sense of what that transition looks like yeah thanks Joe the demand for Hopper is really strong and it's true the demand for uh Blackwell is incredible uh there there's a couple reasons for that the first reason is is um if you just look at look at the world's class service providers the amount of GPU capacity they have available it's basically none and the reason for that is because they're either being deployed internally for accelerating their own workloads data processing for example uh data processing you know we hardly ever talk about it because it's mundane you know it's not it's not very cool because it doesn't generate a picture or you know generate words but almost every single company in the world processes data in the background and and um uh Nvidia gpus are the only accelerators on the planet that process and accelerate data SQL data um pandas data data science uh toolkits like pandas and the new one pols uh these are the one most popular data processing Platforms in the world and aside from CPUs which as I've mentioned before really running out of steam uh nvidia's accelerated Computing is is really the only way to to get uh boosting performance out of that and so so that's number one is the primary the number one use case long before gener came along is that the migration of applications one after another uh to accelerated Computing the the second the second is of course rent the rentals they're they're renting uh capacity uh to model makers they're renting it to uh startup companies and a generative AI company uh spends the vast majority of their uh invested Capital uh into into infrastructure so that they could use an AI to help them create products and and so these companies need it now they they just simply can't afford you know you just raised money you uh they want you to put it to use now uh you have uh processing that you have to do you can't do it next year you got to do it today and so so there's a there's a fair that's one reason the second reason for Hopper Demand right now is because of the race to the next Plateau the first person to the next Plateau um uh gets to be you know a gets to introduce a revolutionary level of AI the second person who gets there is incrementally you know better or about the same and so so the ability to systematically and consistently race to the next plateau and be the first one there is how you establish Lish leadership um you know Nvidia is constantly doing that and we show that uh to the world and the gpus we make and the AI factories that we make uh the networking systems that we make um the S so's we create I mean we we want we want to set the pace we want to be consistently the world's best and that's the reason why we drive ourselves so hard um of course we also want to see our dreams come true and and all of the the the capabilities that that we uh imagine in the future and the benefits that we can bring to society we want to see all that come true and and so these model makers are are um are the same they're they're of course they want to be the world's best they want to be the world's first um and and uh although Blackwell will start uh shipping out in billions of dollars at the end of this year um the the standing up of the capacity is still probably you know weeks and a month or so away and so between now and then is all a lot of generative AI Market Dynamic and so everybody is just really in a hurry it's a it's either operational reasons that they need it they need accelerated Computing um they don't want to build any more uh general purpose Computing infrastructure and even Hopper uh you know of course h200 state-ofthe-art uh Hopper if you have a choice between building CPU infrastructure right now for business or Hopper uh infrastructure for business right now that decision is relatively clear and so uh I think people are just clamoring uh to uh transition the trillion dollars of uh uh established installed infrastructure to a modern infrastructure in Hopper state of the art and your next question comes from the line of Matt Ramsey with TD Cowan your line is open um thank you very much good afternoon everybody um Den I wanted to kind of circle back to an earlier question about uh the debate that investors are having about I don't know the ROI on all of this capex and hopefully this question and the distinction will make some some sense but what I'm what I'm having discussions about is is with like the percentage of folks that you see that are spending all of this money um and looking to sort of push the frontier towards uh um AGI convergence and as you just said a new plateau and capability um and they're going to spend regardless to get to that level of capability because it opens up so many doors for for um the industry and for their company versus customers that are really really focused today on capex versus Roi I don't know if that distinction makes sense I'm just trying to get a sense of how you're seeing the priorities of people that are putting the dollars in the ground on on this new technology and what their priorities are and and their time frames are for that investment thanks thanks man the people who are investing in uh Nvidia infrastructure are getting Returns on it right away it's the best Roi uh infrastructure Computing infrastructure investment you can make today and so so one way to think through it you know probably the most the easiest way to think through it is just go back to First principles you have a trillion dollars worth of general purpose Computing infrastructure and the question is do you want to build more of that or not and for every billion doar worth of General CPU based infrastructure uh that you stand up you probably rent it for less than a billion and so um because it's it's commoditized there's already a trillion dollars on the ground what's the point of getting more and so so the the people who are who are clamoring to get this infrastructure one um when they build out Hopper based infrastructure and soon uh blackw based infrastructure they start saving money that's tremendous return on investment and the reason why they start saving money is because data processing saves money um you know data processing is price just a giant part of it already and so recommender system save money um so on so forth okay and so you start saving money the second thing is everything you stand up uh are going to get rented because so many companies are are being founded to create generative Ai and so your uh your uh uh capacity gets rented right away and the return on investment of that is really good and then the third reason is your own business you know you want to either create the next Frontier yourself or uh your your own internet services uh benefit from a you know a a a Next Generation ad system or next Generation recommender system or next Generation search system uh so for your own Services uh for your own stores uh for your own user generated content social media platforms um you know for for for your own Services generative AI uh is also uh a um a fast RI and so there's a lot of ways you could think through it um but at the core it's because it is the best Computing infrastructure you could put in the ground today the world of general purpose Computing is Shifting to accelerated Computing the world of human engineered software is moving to generative AI software um if you were to build infrastructure to modernize your uh your your cloud and your data centers uh build it with accelerated Computing and videoid that's the best way to do it and your next question comes from the line of Timothy curry with UBS your line is open thanks a lot um I had a question on the shape of the revenue growth both near and longer term I know coet you did um you know increase Opex for the year and if I look at the increase in your purchase commitments and your supply obligations that's also quite bullish on the um uh other hand there's some you know school of thought that not that many customers really seem ready for liquid cooling and I do recognize that some of these racks can be air cooled but Jensen is that something to consider sort of on the shape of how Blackwell's going to R and and then I guess when you look Beyond uh you know next year which is obviously going to be a great year and you look into 26 do you worry about any other you know gating factors like say the power supply chain or uh at some point models start to get smaller I'm just wondering if you can speak to that thanks um I'm going to work backwards I really appreciate the question Tim uh so remember the world is moving from general purpose Computing to accelerated Computing and and the world builds about a trillion dollars worth of data centers um you know a trillion dollars worth of data centers in a few years will be all accelerated Computing in the past no gpus are in data centers just CPUs in the future every single data center while GPS and the reason for that is very clear because we need to accelerate workloads so that we can continue to be sustainable continue to drive down the cost of computing so that when we do more Computing our we don't experience uh Compu inflation uh second uh we need we need gpus for uh a new computer model called generative AI that we can all acknowledge uh is going to be quite transformative to the future of computing and so so I think I think um working backwards uh the way to think about that is is the next trillion dollars of the world's infrastructure will clearly be um different than the last trillion and it'll be vastly accelerated um with respect to to uh the shape of our ramp we offer multiple configurations of uh Blackwell uh Blackwell comes in either a you know blackwall classic if you will that uses the hgx form factor that we pioneered uh with uh with volte and I think it was Volta and so um uh we've been shipping the hgx hgx form factor for some time it is air cooled uh the Grace Blackwell um is liquid cooled however that the number of data centers that want to go liquid cooled is is quite significant and the reason for that is because we can uh in a liquid cool data center in any data center power limited data center whatever size data center you choose you could install and deploy anywhere from three to five times the AI throughput compared to the Past and so liquid cooling is cheaper liquid cooling uh TCO is better and liquid cooling allows you to have the benefit of this capability we call MV link which allows us to expand it to 72 Grace blackwall packages which has essentially 144 gpus and so imagine 144 gpus is connected in mvlink and that when we're increasingly showing you the benefits of that and the next you know the next click is obviously uh very low latency very high throughput large language model inference and the large mvlink domain is going to be a game Cher for that and so so I think I think people are uh are very comfortable deploying both and so almost every CSP we're working with are deploying uh some of both and so I uh I'm pretty confident that that we'll wrap it up just just fine uh your your second question out of the third is that looking forward yet next year is going to be a great year uh we expect to uh grow our data center business uh quite significantly next year uh Blackwell is going to be going to be a a complete uh game changer for the industry and um uh blackwall is going to carry into into the following year and as I mentioned earlier working backwards from first principles uh remember that Computing is going through two platform transitions at the the same time and that's just really really important to keep your head on your your mind focused on which is uh general purpose Computing is Shifting to accelerated Computing and human engineered software is going to transition to generative AI or artificial intelligence learn software okay and your next question comes from the line of Stacy Rasin with Bernstein research your line is open hi guys thanks for taking my questions I have two short questions for collect um the first uh several billion dollars of blackw Revenue in Q4 like is that addative you you said you expected Hopper demand to strengthen in the second half that mean Hopper strengthens Q3 to Q4 as well on top of Blackwell adding several billion dollars and the second question on Gross margins if I have mid mid 70s for the year dep where I want to draw that if I have 75 for the year I'd be something like 71 to 72 for Q4 somewhere in that range is that the kind of exit rate for gross margins that you're expecting and how should we think about the drivers of gross margin Evolution into next year um as Blackwell ramps and I mean hope hopefully I guess the yields and and and the inventory reserves and everything come up yes Stacy let's first take your uh question um uh that you had about Hopper and Blackwell uh so we believe our Hopper um will continue to grow into the second half we have many new products uh for Hopper our existing products for Hopper that we believe will start continuing to ramp um in the next uh uh quarters including our Q3 and um those new products moving to Q4 so let's say Hopper there for versus H1 is a growth opportunity for that additionally we have the black well on top of that and the blackw starting of um ramping in Q4 so hope that helps you on those two pieces uh your second piece is in terms of on our gross margin we provided gross margin uh for our Q3 we provided our gross margin on a non Gap at about uh 75 um we'll work um with all the different uh transitions that we're uh going through but we do believe we can do that 75 and Q3 we provided that we're still on track for the full year also in the mid 70s or approximately the 75 so we're going to see some slight um uh difference possibly in Q4 um again with our Transitions and the different cost structures that we have on our new product introductions however I'm not in the same number that you are um there we don't have exactly guidance um but uh I do believe you're lower than where we are and your next question comes from the line of Ben rites with melus your line is open yeah hey um thanks a lot for the question Jensen and Colette um I wanted to ask about the geographies uh there was uh the tenq that came out and the United States was down sequentially while uh several Asian geographies were up a lot sequentially just wondering what the Dynamics are there um you know and um obviously China did very well you mention it in your remarks what are the puts and takes and then I just wanted to clarify from Stacy's question um if that means the sequential overall Revenue growth rates for the company accelerate in the fourth quarter given all those favorable Revenue Dynamics thanks let me talk about um a bit in terms of our disclosure in terms of the 10 q a required disclosure in uh a choice of geographies very challenging sometimes to uh create that uh right disclosure as we have to come up with uh one key piece pieces in terms of we have in terms of who we sell to Andor specifically who we invoice to and so what you're seeing in terms of there is who we invoice that's not necessarily where the product will eventually be um uh and where it may even travel to the End customer these are just moving to our oems our odms and our system integrators for the most part across our product portfolio so what you're see there is sometimes just a Swift uh shift in terms of who they are using uh to complete their full configuration before those things are going into the data center going into notebooks and those pieces of it uh and that shift happens uh from time to time but yes uh our China number there are invoicing into China keep in mind that is incorporating both gaming also data center also Automotive in those uh numbers that we have going back to your statement in regards gross margin um and um also what we're seeing in terms of uh what we're looking at for Hopper and Blackwell in terms of Revenue Hopper will continue to grow in the second half um we'll continue to grow from what we are currently seeing during determining that exact mix um in each Q3 and Q4 we don't have here we are not here to guide uh yet in terms of Q4 but we do see right now the demand expectations we do see um the visibility that that will be a growth opportunity in Q4 on top of that we will have our Blackwell architecture and your next question comes from the line of CJ Muse with caner Fitzgerald your line is open yeah good afternoon thank you for taking the question um you've embarked on a remarkable annual product Cadence with with challenges only likely becoming more and more given you know Rising complex complexity in a retical limit Advanced package world so curious you know if you take a step back how does this backdrop alter your thinking around potentially greater vertical integration supply chain Partnerships and and then thinking through consequential impact to your margin Pro profile thank you yeah thanks uh let's see I think the uh the fir well the first the the first answer to your the answer to your first question is that the reason why our velocity is so high is simultaneously because uh the complexity of the model is growing and we want to continue to drive its cost down um it's growing so we want to continue to increase its scale and we believe that uh by continuing to scale the AI models that will reach a a level of of extraordinary usefulness and that would it would um open up I uh realize the next Industrial Revolution we believe it and and so we're we're going to drive ourselves really hard to do to to continue to uh uh uh go up that scale um we have the ability uh fairly uniquely to integrate uh to design a um an AI Factory uh because we have all the parts it's not possible to come up with a new AI Factory every year unless you have all the parts and so we have uh next year we're going to ship a lot more CPUs than we've ever had in the history of our company more gpus of course uh but also MV link switches um uh CX uh dpus connectx dpu for East and West uh Bluefield dpus for north and south and uh data and storage processing uh to um infiniband for supercomputing centers to ethernet which is a brand new product for us uh which is well on way to becoming a multi-billion Dollar business uh to to bring AI to ethernet and so the fact that we could build we have we have access to all of this we have one architectural stack as you know um it allows us to introduce new capabilities to the market you know as we complete it otherwise what happens you ship these parts you go find customers to sell it to and then you've got to build somebody's got to build up an AI Factory and the AI Factory has got a m in the software and so it's not about it's not about who integrates it we love the fact that our supply chain is disintegrated in the sense that we could service um uh you know quanta foxcon HP Dell Lenovo uh super micro I uh we used to be able to Ser as ZT um they were recently uh purchased and um uh and so on so forth and so the the number of ecosystem partners that we have a gigabyte assus the number of ecosystem partners that we have that allows it allows us to allows them to take our architecture which all works but integrated in a bespoke way into all of the world's cloud service providers Enterprise data centers the scale and reach necessary from our odms and our integrators integr integrator supply chain is vast and gigantic because the world is huge huge and so that part we don't we don't want to do and we're not good at doing and um uh but we know how to design the AI infrastructure provide it the way that customers would like it and lets the ecosystem integrated um well yeah so anyways that's the reason why and your final question comes from the line of Aaron rakers with Wells Fargo your line is open yes thanks for taking the question I wanted to go back into the the Blackwell product cycle one of the questions that that we tend to get asked is is how you see the the rack scale system mixed dynamic as as you think about leveraging NV link you think about GB you know nvl 72 and and how that goto Market you know dynamic looks you know as far as the the blackw product cycle I guess put distinctly how do you see that mix of rack scale systems as we start to think about the black W Blackwell cyle playing out yeah eron thanks the um the black wall rack system it's designed and architected as a rack but it's sold in a disag in disaggregated system components we don't sell the whole rack and the reason for that is because everybody's rack's a little different surprisingly you know some some of them are ocp standards some of them are not some of them are Enterprise uh and uh the the power limits for everybody could be a little different choice of cdus uh the choice of um uh Power bus bars the the the configuration and integration into people's data centers all different and so so the way we designed it we architected the whole rack the software is going to work perfectly across the whole rack and then we uh provide the system components like for example the uh CPU and GPU comp compute uh uh board is then integrated into an mgx it's a modular system architecture mgx is is completely ingenious and uh we have mgx odms and integrators and oems all over the planet and so so just about you know any configuration you would like uh where you would like that 3,000 pound rack to be uh delivered you know it's got to be close to it's it has to be integrated and assembled close to the data center because it's fairly heavy and so everything from the supply chain from the moment that we ship the GPU CPUs uh the switches the nxs from that point forward the integration is done quite close to the location of the csps and the locations of the the data centers and so you could imagine how many data centers in the world are and how many Logistics hubs uh We've uh scaled out to with our odm partners and so I think that because we we show it as one rack and because it's always you know rendered that way and and shown that way we we might have left the impression that we're doing the integration our customers hate that we do integration the supply chain hates us doing integration they want to do the integration that's their value added um there's a final design design in if you will you know it's not quite as simple as shimmy into a DAT data center but that design fit in is really complicated and so the install the design fit in the installation the bring up the um uh uh repair uh repair and replace that entire cycle is done all over the world and we have a crawling network of odm and OEM partners that does this incredibly well so uh integration is not the reason why we're doing uh racks it it's it's the anti-reason of doing it um the way we don't want to be an integrator we want to be a a technology provider and I will now turn the call back over to Jensen Hong for closing remarks thank you let me make a couple more make a couple of comments that I made earlier again that data center worldwide are in Full Steam to modernize the entire Computing stack with accelerated Computing and generative AI Hopper demand remains strong and the anticipation for black well is incredible let me highlight the top five things the top five things of our company accelerated Computing has reached the Tipping Point CPU scaling slows developers must must accelerate everything possible accelerated Computing starts with Cuda X libraries new Li libraries open new markets for NVIDIA we released many new libraries including could accelerated polers pandas and Spark the leading data science and data processing libraries CVS for Vector Pro Vector databases this is incredibly hot right now Ariel and shiona for 5G wireless base station a whole Suite of a whole world of data centers that we can go into now parir bricks for Gene sequencing and Alpha full two for protein structure prediction is now C accelerated we are at the beginning of our journey to modernize a trillion dollars worth of data centers from general purpose Computing to accelerated Computing that's number one number two Blackwell is a step function leap over Hopper Blackwell is an AI infrastructure platform not just a GPU also happens to be in the name of our GPU but it's an AI infrastructure platform as we reveal more of Blackwell and sample systems to our partners and customers the extent of Blackwell's leap becomes clear the Blackwell Vision took nearly five years and seven one-of-a-kind chips to realize the gray CPU the Blackwell dual GPU and a Coos package connectx dpu for East West traffic blue field dpu for north north north south and storage traffic mvlink switch for all to all GP Communications and Quantum and Spectrum X for both infiniband ethernet can support the massive burst traffic of AI Blackwell AI factories are building siiz computers Nvidia designed and optimized the Blackwell platform full stack end to end from chips systems networking even structured cables power and Cooling and mountains of software to make it fast for customers to build AI factories these are very Capital intensive infrastructures customers want to deploy it as soon as they get their hands on the equipment and deliver the best performance and TCO Blackwell provides three to five times more AI throughput in a power limited data center than Hopper the third is MV link this is a very big deal with its all to all GPU switch is gamechanging the blackwall system lets us connect 144 gpus in 72 gb200 packages into one MV link domain with an aggregate aggregate mvlink bandwidth of 259 terabytes per second in one rack just put that in perspective that's about 10 times higher than Hopper 259 terabytes per second kind of makes sense because you need to boost the training of multi-trillion parameter models on trillions of tokens and so that natural amount of data needs to be moved around from GPU to GPU for inference MV link is vital for low latency High throughput large language model token generation we now have three networking platforms MV link for GPU scale up Quantum infiniband for supercomputing and dedicated AI factories and Spectrum X for AI on ethernet M's networking footprint is much bigger than before generative AI momentum is accelerating generative AI Frontier Model makers are racing to scale to the next AI Plateau to increase model safety and IQ we're also scaling to understand more modalities from text images and video to 3D physics chemistry and biology Chad Bots coding AIS and image generators are growing fast but it's just a tip of the iceberg internet service are deploying generative AI for large scale recommenders add targeting and search systems AI startups are consuming tens of billions of dollars yearly of csp's cloud capacity and countries are recognizing the importance of AI and investing in Sovereign AI infrastructure and Nvidia Ai and Nvidia Omniverse is opening up the next era of AI General Robotics and now the Enterprise AI wave has started and were poised to help companies transform their businesses the Nvidia AI Enterprise platform consists of Nemo Nims Nim agent Blueprints and AI foundary that our ecosystem Partners the world leading it companies used to help customer C companies customize AI models and build bespoke AI applications Enterprises can then Deploy on Nvidia AI Enterprise runtime and at $4,500 per GPU per year Nvidia AI Enterprise is an exceptional value for deploying AI anywhere and for nvidia's software Tam can be significant as the Cuda compatible GPU install base grows from Millions to tens of millions and as Colette mentioned Nvidia software will exit the year at a$2 billion run rate thank you all for joining us today and ladies and gentlemen this concludes today's call and we thank you for your participation you may now disconnect [Music] [Music] [Music] e e e e e thank you for tuning in that concludes the stream so all in all Nvidia did beat on revenue and EPs and they end up gapping uh down and we can see it's a relatively flat move we did move a few few percentage points to the downside about 78% uh 70% to the downside but this is all within the expected move remember 10% 10.9% was the expected move and to the downside that would have been that 11125 to the upside that would have been that 13838 and right now we're at that 116 86 87 and and um some change so again thank you for tuning in I will post the earnings details earnings um report details in the Discord and the free tier so make sure to join there make sure to like the video make sure to subscribe have a great rest of your afternoon and I'll see you guys tomorrow at 9:00 a.m. for our live options trading show God bless [Music] [Music] [Music] [Music] [Music]