NVIDIA (NVDA 115.25, +12.31) has spiked 12.0% in pre-market after reporting better than expected first quarter results and issuing above-consensus guidance.
The GPU manufacturer reported above-consensus first quarter earnings of $0.85 per share on a 48.7% year-over-year surge in revenue to $1.94 billion, which was also ahead of expectations.
Gross margin improved to 59.6% from 58.6% one year ago.
NVIDIA's results showed strong year-over-year growth across most segments while OEM & IP revenue declined 10.0% to $156 million. However, this segment made up just 8.0% of total sales.
The small decline in OEM & IP revenue was more than offset by a 49.0% year-over-year jump in Gaming revenue, which spiked to $1.03 billion. GeForce GPUs have continued selling at a strong pace even though the GTX1000 line is now nearly a year old. The company made a slight refresh by releasing GTX 1080 Ti in March. The video card claims 35.0% higher performance than the GTX1080.
In addition to capitalizing on demand from end-users, NVIDIA has benefitted from the rising popularity of deep learning and AI processes. Datacenters revenue surged 186.0% year-over-year to $409 million and Professional Visualization revenue rose 8.0% to $205 million.
NVIDIA remains among several companies working to develop autonomous driving software for vehicles through partnerships with brands like Audi, Bosch, and PACCAR, among others. Auto revenue jumped 24.0% year-over-year to $140 million and the segment is now on the verge of surpassing the OEM & IP segment in terms of sales.
Looking ahead, NVIDIA expects second quarter revenue will between $1.91 billion and $1.99 billion, which is ahead of current market expectations. The company expects its non-GAAP gross margin will be within 50 basis points of 58.6%.