NVIDIA CORP Q4 FY2025 earnings call

• Data Center: Blackwell ramped quickly with $11 billion in Q4 revenue, data center compute revenue up 18% QoQ and over 2x YoY, inference demand accelerating.
• Networking: Transitioning from NVLink 8 to NVLink 72, expect growth in Q1.
• Gaming: New GeForce RTX 50 series launched, supply constraints in Q4, expect Q1 growth.
• Professional Visualization: Growth driven by automotive and healthcare, leveraging generative AI.
• Automotive: Record revenue driven by autonomous vehicles, partnerships like Toyota and Aurora announced.

Data Center: Fiscal 2025 revenue was $115.2 billion, more than doubling from the prior year. Q4 data center revenue was $35.6 billion, a record, up 16% sequentially and 93% year on year. Blackwell ramped quickly, with $11 billion of Blackwell revenue in Q4. Q4 data center compute revenue jumped 18% sequentially and over 2x year on year. Networking: Declined 3% sequentially, transitioning from small NVLink 8 to large NVLink 72, expect growth in Q1. Gaming and AR PCs: Q4 revenue $2.5 billion, down 22% sequentially and 11% year on year; full year revenue $11.4 billion, up 9% year on year. New GeForce RTX 50 series launched, supply constraints in Q4, expect Q1 growth. Professional Visualization: Q4 revenue $511 million, up 5% sequentially and 10% year on year; full year revenue $1.9 billion, up 21% year on year. Driven by automotive and healthcare. Automotive: Q4 revenue was a record $570 million, up 27% sequentially and 103% year on year; full year revenue $1.7 billion, up 55% year on year. Driven by autonomous vehicles, partnerships announced.

• Q1 2026 total revenue expected to be $43 billion ±2%.
• GAAP and non-GAAP gross margins expected to be 70.6% and 71% respectively, ±50 basis points.
• GAAP operating expenses expected to be approximately $5.2 billion, non-GAAP operating expenses ~$3.6 billion. Full year 2026 operating expenses expected to be in the mid-thirties.
• GAAP and non-GAAP tax rates expected to be 17% ±1% excluding discrete items.

• Supply chain constraints impacting gaming shipments.
• Uncertainties around export controls and tariffs affecting China sales and global operations.

Q: For me, Jensen, as test time compute and reinforcement learning shows such promise, we're clearly seeing increasing blurring in the lines between training and inference. What does this mean for the potential future of potentially inference-dedicated clusters? And how do you think about the overall impact to NVIDIA Corporation and your customers?

A: Jensen Huang discussed multiple scaling laws (pretraining, post-training, test time compute), Blackwell designed for reasoning models, and fungibility of NVIDIA's architecture across different workloads.

Q: I wonder if you could talk about GV200 at CES. You sort of talked about the complexity of the rack-level systems and the challenges you have. And then as you said in the prepared remarks, we've seen a lot of general availability. Where are you in terms of that ramp? Are there still bottlenecks to consider at a systems level above and beyond the chip level? And just you know, have you maintained your enthusiasm for the NVLink 72 platforms?

A: Jensen Huang stated they successfully ramped Grace Blackwell, delivered $11 billion in Q4 revenue, partners are doing well with systems coming online, and enthusiasm remains high for NVLink 72 platforms.

Q: Could I just you wouldn't mind confirming if Q1 is the bottom for gross margins? And then, Jensen, my question is for you. What is on your dashboard to give you the confidence that the strong demand can sustain into next year and has DeepSeq and whatever innovations they came up with, has that changed that view in any way?

A: Colette Kress said during Blackwell ramp, gross margins will be in the low seventies, focusing on expediting manufacturing, and Jensen Huang discussed capital investment sight, software shift to machine learning, and vibrant start-ups driving demand.

Q: Your next generation Blackwell Ultra is set to launch in the second half of this year. In line with the team's annual product cadence. Jensen, can you help us understand the demand dynamics for Ultra given that you'll still be ramping the current generation Blackwell solutions? How do your customers and the supply chain also manage the simultaneous ramps of these two products and is the team still on track to execute Blackwell Ultra in the second half of this year?

A: Jensen Huang said Blackwell Ultra is on track for second half, recovery from earlier hiccup, transition between Blackwell and Ultra will slot in, and exciting products ahead like Vera Rubin.

Q: Thanks a lot. Jensen, we hear a lot about custom ASICs. Can you kinda speak to the balance between custom ASIC and merchant GPU? We hear about some of these heterogeneous super clusters to use both GPU and ASIC. Is that something customers are planning on building or will these infrastructures remain fairly distinct?

A: Jensen Huang discussed NVIDIA's general architecture, end-to-end capability, performance, software stack complexity, and why NVIDIA's technology is preferred for deployment.

Q: Yeah. Hi. Ben Reitzes here. Hey. Thanks a lot for the question. Hey, Jensen. It's a geography-related question. You know, you did a great job explaining some of the demand underlying, you know, factors here on the strength. But the US was up about $5 billion or so sequentially. And I think, you know, there is a concern about whether the US can pick up the slack if there's regulations towards other geographies. And I was just wondering as we go throughout the year, you know, if this kind of surge in the US continues and it's gonna be whether that's okay. And if that underlies your growth rate, how can you keep growing so fast with this mix shift towards the US? Your guidance looks like China is probably up sequentially. So just wondering if you could go through that dynamic and maybe Colette can weigh in.

A: Jensen Huang discussed AI going mainstream across geographies, software integration into all applications, and being at the beginning of the new era of AI, while Colette Kress mentioned China's percentage of data center revenue remains similar.

Q: Hi. This is Marshall Pappas. Thanks for taking the question. Question. I had a clarification and a question. Colette, for the clarification. Did you say that enterprise within the data center grew 2x year on year for the January quarter? And if so, does that would that make it the faster growing than the hyperscalers? And then, Jensen, for you, the question, hyperscalers are the biggest purchasers of your solutions, but they buy equipment for both internal and external workloads, external workloads being cloud services that enterprises use. So the question is, can you give us a sense of how that hyperscale expense splits between that external workload and internal and as these new AI workflows and applications come up, would you expect enterprises to become a larger part of that consumption mix? And does that impact how you develop your service your ecosystem?

A: Colette Kress confirmed enterprise grew 2x, similar to CSPs, and Jensen Huang discussed CSPs' internal and external consumption, fungibility of NVIDIA's infrastructure, and long-term growth potential of enterprises.

Q: Yeah. Thanks for letting me back in. Jensen, I'm curious as we now approach the two-year anniversary of really the Hopper inflection that you saw in 2023 in Gen AI in general. We think about the roadmap you have in front of us, how do you think about the infrastructure that's been deployed from a replacement cycle perspective and whether, you know, if it's GV300 or if it's the Rubin cycle where we start to see maybe some refresh opportunity. I'm just curious to how you look at that.

A: Jensen Huang discussed continued use of past architectures for less intensive workloads like data processing and curation, with CUDA compatibility allowing use across different GPUs.

Q: Hi. Thank you for taking my question. I have a follow-up question on gross margins, Colette. I understand there are many moving parts that will yield and NVLink 72 and Ethernet mix. And you kind of tiptoed the earlier question if April quarter is the bottom. But second half would have to ramp, like, 200 basis point per quarter to get to the mid-seventies range that you're giving, for the end of the fiscal year. And we still don't know much about tariffs impact to broader semiconductor. So what kind of gives you the confidence in that trajectory in the back half of this year?

A: Colette Kress mentioned opportunities to improve gross margins over time with Blackwell's configurations, and uncertainties around tariffs awaiting further government plans.