By Summer
Source: GPLP
On Feb. 14, Nvidia（NVDA.NASDAQ）reported fourth-quarter and full-year results for fiscal year 2020. The revenue is $3.105 billion, up 41%, and net income of $950 million, up 68%, as of Jan. 26,2020 by fourth quarter of 2019.
NVIDIA accelerated revenue growth in the fourth quarter was mainly due to rapid growth in the data center business, with NVIDIA recording revenue of $968 million in the fourth quarter, up 42.6%.
Jensen Huang, founder and CEO of Nvidia, says the accelerated computing business has delivered better results over the past year, while the data center business has delivered record revenue.
But for fiscal 2020 as a whole, Nvidia did not sustain the momentum of fourth quarter growth. Nvidia posted revenue of $10.92 billion in fiscal 2020, down 7% year on year, and net income of $2.796 billion, down 32% year on year.
In addition, according to the data of each business departments, the revenue of the game department was $5.518 billion in fiscal year 2020, down 12% from the same period last year; the revenue of the Data Center department was $2.983 billion, up 2% from the same period last year; and the revenue of the professional visualization department was $1.212 billion, up 7% from the same period last year, the revenue of Auto department was $700 million, up 9% year on year; OEM and other department has $505 million revenue, down 34% year on year.
Nvidia started out as a graphics player, and in recent years PC games have been losing market share globally to other players. With the rise of mobile games market, most players are also from the PC side to the mobile side.
According to the Global Gaming Market Report 2019 by Newzoo, the market share of PC games will continue to shrink in the coming years until 2022, while mobile games will outstrip the growth of console games when they surpass PC revenues, web games will continue to decline. Clearly, this trend in the gaming business is negative signal for NVIDIA.
In addition to the increased competitive pressure in the gaming business, Nvidia’s archrivals, such as Intel and AMD, are making inroads into the graphics card market in which they operate.
Notably, Nvidia cut 2021’s revenue forecast for the first quarter by $100 million to $3 billion because of the epidemic situation in China. China accounts for about 30% of NVIDIA’s Gaming Chip Sales, Colette Kress, Nvidia’s chief financial officer, said on a conference call.
