Nvidia's NVDA stock closed on Thursday with gusto after its impressive Q 3 earnings report on Wednesday. After a jump of more than 10% at the open, the chip maker's shares ended up up 8.25% at the end of the day. The stock's performance comes after the company reported a 50% increase in quarterly revenue in Q3 on the back of strong performances by its data center and gaming businesses.
The data center arm of Nvidia helped to boost the stock price by 124% year-over-year at the close of trading on Wednesday. Nvidia's gaming business brought in record revenue of $3.22 billion a year-over-year increase, a 42% increase.
The earnings report came just a week after Nvidia CEO Jensen Huang hosted the company's GTC 2021 conference, where it presented new hardware and software related to its metaverse platform, called Omniverse, its self-driving vehicle initiatives, and its artificial intelligence work.
Nvidia, like other chipmakers, has also been stung by the chip shortage. The consumer graphics cards of the company are incredibly scarce thanks to a run on them by both criptominers and resellers using bots to grab as many cards as possible.
Cards are selling for hundreds of dollars more than their suggested retail price. Cards that shouldn't cost $599 are going for well north of $1,000, and finding any near their original prices is a pointless endeavor. Nvidia doesn't see the benefit of those inflated prices.
Nvidia still makes a majority of its cash on its games business, but the data center arm of the company has become increasingly important for the future of the company. The firm is a leader in large-scale artificial intelligence systems due to the power of its cards parallel processing, and it is going to roll out its own CPU to make sure its data centers don't have to use its competitors processors.
But not everything is going well for Nvidia. The company plans to purchase chip designer ARM has hit a regulatory wall in the U.K. where it is undergoing an in-depth review. It needs to get through regulators in both the U.S. and China before it can be finalized.
Huang told Yahoo Finance Live that the company will continue to be successful regardless of whether the deal goes through, because it is prepared to move forward with or without ARM.
The investors have a similar level of faith in the company.
Nvidia CEO Huang said AI is the'most powerful technology force the world has known.
None of the Nvidia CEO: We don't have any magic bullets to deal with chip shortage.
None of Nvidia is on the top of the world, but its rivals are gaining steam.
Email Daniel Howley at dhowleyyahoofinance.com via encrypted mail at danielphowley protonmail.com, and follow him on Twitter at DanielHowley.