Nvda 28092022132137-0001 PDF
Nvda 28092022132137-0001 PDF
Nvda 28092022132137-0001 PDF
Q2 FY2023
September 1, 2022
Except for the historical information contained herein, certain matters in this presentation including, but not limited to, statements as to: our financial position; our markets; the
performance, specifications, benefits, impact and availability of our products and technologies, including NVIDIA Grace and Grace Hopper, NVIDIA Omniverse, NVIDIA H100, NVIDIA QODA,
NVIDIA DGX, and NVIDIA GPUs; upcoming launches of our products and architectures; channel inventory correction impacting future revenue; our partnerships, collaborations, and
customers; our financial outlook, our expected tax rates and our expected capital expenditures for the third quarter of fiscal 2023; our growth and growth drivers; trends and our
opportunities in existing and new markets; rollout plans on NVIDIA DRIVE; leading supercomputing centers being among the first with systems featuring NVIDIA Grace and Grace Hopper;
NVIDIA AI delivering the highest productivity per dollar; evolving Universal Scene Description (USD) to become a foundation of the open metaverse and 3D internet and its impact; ongoing
development unlocking metaverse workflows for manufacturing, engineering and design companies; neural graphics redefining how virtual worlds are created; optimizing across the entire
stack allowing NVIDIA to advance computing in the post-Moore’s law era; and our plan for 100% of our global electricity usage for our offices and data centers to be renewable by 2025 are
forward-looking statements.
These forward-looking statements and any other forward-looking statements that go beyond historical facts that are made in this presentation are subject to risks and uncertainties that
may cause actual results to differ materially. Important factors that could cause actual results to differ materially include: global economic conditions; our reliance on third parties to
manufacture, assemble, package and test our products; the impact of technological development and competition; development of new products and technologies or enhancements to our
existing product and technologies; market acceptance of our products or our partners' products; design, manufacturing or software defects; changes in consumer preferences and
demands; changes in industry standards and interfaces; unexpected loss of performance of our products or technologies when integrated into systems and other factors.
NVIDIA has based these forward-looking statements largely on its current expectations and projections about future events and trends that it believes may affect its financial condition,
results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of
risks and uncertainties, and you should not rely upon the forward-looking statements as predictions of future events. The future events and trends discussed in this presentation may not
occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Although NVIDIA believes that the expectations reflected
in the forward-looking statements are reasonable, the company cannot guarantee that future results, levels of activity, performance, achievements or events and circumstances reflected in
the forward-looking statements will occur. Except as required by law, NVIDIA disclaims any obligation to update these forward-looking statements to reflect future events or circumstances.
For a complete discussion of factors that could materially affect our financial results and operations, please refer to the reports we file from time to time with the SEC, including our most
recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. Copies of reports we file with the SEC are posted on our website and are available
from NVIDIA without charge.
NVIDIA uses certain non-GAAP measures in this presentation including non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP operating margin,
non-GAAP net income, non-GAAP diluted earnings per share, and free cash flow. NVIDIA believes the presentation of its non-GAAP financial measures enhances investors' overall
understanding of the company's historical financial performance. The presentation of the company's non-GAAP financial measures is not meant to be considered in isolation or as a
substitute for the company's financial results prepared in accordance with GAAP, and the company's non-GAAP measures may be different from non-GAAP measures used by other
companies. Further information relevant to the interpretation of non-GAAP financial measures, and reconciliations of these non-GAAP financial measures to the most comparable GAAP
measures, may be found in the slide titled “Reconciliation of Non-GAAP to GAAP Financial Measures”.
Content
• Q2 FY23 Earnings Summary
• NVIDIA Overview
• Financials
GAAP Non-GAAP
9,500 Revenue($M) Non-GAAP GM 100.0%
5,500 70.0%
66.7% 67.0% 67.0% 67.1%
Operating
$499 -80% -73% $1,325 -57% -66%
Income
4,500
60.0%
50.0%
2,500 45.9%
Diluted EPS $0.26 -72% -59% $0.51 -51% -63%
1,500 40.0%
Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 Cash Flow
$1,270 -53% -27% $1,270 -53% -27%
from Ops
All dollar figures are in millions other than EPS. Diluted EPS changes reflects a four-for-one stock split effective July 2021.
Data Center
Highlights
61% y/y
and • Revenue from hyperscale customers nearly doubled y/y
1% q/q
Highlights
• Gaming partners and ecosystem are responding to a
sudden slowdown in consumer demand and correcting
$3,620 channel inventory
$3,420
$3,221 • NVIDIA implemented programs with channel partners to
$3,061
adjust pricing, and to price-position current high-end
desktop GPUs ahead of new architecture launch
33% y/y
and
44% q/q • Estimated GeForce GPU sell-through is up over 70%
$2,042
since before the pandemic
• RTX now supported by almost 300 games & applications
• 15 of the top 15 most popular GPUs on Steam are
NVIDIA GeForce GPUs
• GeForce Now registered members now exceed 20
million; over 1,350 games total
Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23
Revenue ($M)
Professional Visualization
$643 Highlights
$622
4% y/y
$577 and • Sequential increase in mobile revenue was more than
20% q/q
$519 offset by lower desktop revenue, particularly at the
$496
high-end
• Enterprise demand slowed as macroeconomic
headwinds intensified
• OEMs worked to reduce inventory; expect trends to
persist in Q3
• While Pro Viz is undergoing a near-term adjustment
after doubling last year, AI and Omniverse workloads
have expanded the market opportunity over the last
couple of years
Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23
Revenue ($M)
Automotive
45% y/y
and
59% q/q
$220 Highlights
• Q2 an inflection point for Automotive revenue, as NVIDIA
Orin has great momentum
$152 • Strong growth driven by Auto AI Solutions (AI Cockpit
$135
$125
$138
and Self-Driving revenue)
• Strength in Self-Driving driven by New Energy Vehicle
design wins ramping into volume
• Announced rollout plans, all built on NVIDIA DRIVE
• New vehicles from NIO, Li Auto, JIDU, and Human Horizons
• Pony.ai’s line of self-driving trucks and robotaxis
Revenue ($M)
Sources & Uses of Cash
$3,033 Highlights
$2,682 • Sequential decrease reflects lower revenue and
higher cash tax payments, partially offset by reduced
advance payments on supply payments
Gross Margins 62.4% GAAP and 65.0% non-GAAP, plus or minus 50 basis points
Operating Expense Approximately $2.59 billion GAAP and $1.82 billion non-GAAP
Other Income & Expense Net expense of approximately $10 million for GAAP and non-GAAP
Excluding gains and losses on non-affiliated investments
Tax Rate 9.5% GAAP and non-GAAP, plus or minus 1%, excluding discrete items
As disclosed in NVIDIA's Current Report on Form 8-K filed with the SEC on August 31, 2022, NVIDIA's outlook for its third fiscal quarter
provided on August 24, 2022 included approximately $400 million in potential sales to China (including Hong Kong) which may be subject
to a new license requirement by the U.S. government if customers do not want to purchase NVIDIA’s alternative product offerings.
Key Announcements
This Quarter
Top Global Systems Makers
Accelerate Adoption of NVIDIA
Grace and Grace Hopper
$11.7B
2006: Unveils CUDA architecture, expanding to scientific computing $9.7B $10.9B
CUDA-X
MIT Tech Review’s 50 Smartest Companies CUDA
FY22 REVENUE $12.5B, FY22 REVENUE OF $10.6B, FY22 REVENUE OF $2.1B, FY22 REVENUE OF $566M,
5-YEAR CAGR OF 25% 5-YEAR CAGR OF 66% 5-YEAR CAGR OF 20% 5-YEAR CAGR OF 3%
Strong market position and Leader in deep learning/AI 90%+ market share in graphics Historical revenue driven largely
technology leadership ― for workstations by infotainment
used by all major cloud computing
Compounded long-term providers and thousands Diversified end markets, Future growth largely driven by
unit and ASP growth of enterprises e.g. media & entertainment, Autonomous Vehicles, where
architecture, engineering & NVIDIA offers a full hardware &
200M+ gamers on GeForce Leader in Supercomputing construction, public sector software stack
―
Strong Gaming ecosystem 357 of the TOP500 Strong software ecosystem Over $11B design win pipeline
Multiple secular growth drivers: Multiple secular growth drivers: Multiple secular growth drivers: Multiple secular growth drivers:
adoption of RTX, expanding fast growing adoption of AI and adoption of RTX, hybrid work transition to self-driving,
population of gamers and creators, graphics in every major industry; environments and collaborative software-defined cars, with
eSports, VR, rising production value rising compute needs unmet by 3D design, AR/VR, AI and virtual new software and services
of games, gaming laptops and conventional approaches such as x86 world workloads, Omniverse business models
cloud gaming CPUs; data-center scale computing Enterprise software
ASP = Average Selling Price. Gamers are defined as consumers who purchase our GPUs to play video games. 200M+ gamers on our platform as of August 2020. FY22 ended 1/30/2022.
Growth, Profitability and Mix Metrics
Revenue ($M) Gross Margin Operating Margin Revenue ($M) Gross Margin Operating Margin 1H FY22 1H FY23
30,000 100% 15,000 100% 6 22
3 7
7
90%
38
24,000 12,000 80%
80% 48
66%
Refer to Appendix for reconciliation of Non-GAAP measures. Gross margin and operating margin are rounded to the nearest percent in the charts above.
Why Accelerated Computing?
Advancing computing in the post-Moore’s Law era
109
this challenge
105 1.1X per year
• Optimizing across the entire stack — from silicon to
software — allows NVIDIA to advance computing in the 104
• Gaming, Pro Viz, High Performance Computing (HPC), 1.5X perf per year
AI, Cloud, Transportation, Healthcare, Robotics, and the 102
$7,556
2.5M
46%
$6,696
2.0M
1.5M
$2,932 $2,983
$1,932
1.0M
FY18 FY19 FY20 FY21 FY22 1H FY23 2005 2010 2015 2022 ISC18 ISC19 ISC20 ISC21 ISC22
Revenue ($M) Registered NVIDIA Developers Every Major Cloud Provider Most TOP500 Supercomputers
Gaming
GeForce — The world’s largest gaming platform
$6,246
$5,513 $5,518
$5,662
Expanding the market with creators,
gaming laptops and cloud gaming
LumenRT Microstation
Connect
$1,212
$1,130 $1,118
$1,053 Denoise AI Gigapixel AI
$934 Marmoset
Toolbag
NVIDIA
Broadcast
NVIDIA
Omniverse
Mantra
RHINO
Wisp
FY18 FY19 FY20 FY21 FY22 1H FY23 Sharpen AI Video Enhance AI Gazebo RT
Renderer
3% 5-YR CAGR
$700
Software 87
$641
Mapping 10
$358
Robotaxis 26
Tier 1s 30
Trucks 14
Car Makers 48
HPC
Vertical Industry
Reaching 200M+ PC Gamers
Every Major PC OEM/ODM
Every Major Graphics Card Manufacturer
No Customer Larger than 10% of Total Revenue for the Last 2 Fiscal Years
Financials
Annual Cash & Cash Flow Metrics
5,822
6,803 4,761
3,502 3,743
4,407
3,617 3,735
FY18 FY19 FY20 FY21 FY22 FY18 FY19 FY20 FY21 FY22
4,677
4,272 11,561
10,897
2,909 3,143
7,108 7,422
FY18 FY19 FY20 FY21 FY22 FY18 FY19 FY20 FY21 FY22
Cash balance is defined as cash and cash equivalents plus marketable securities
Refer to Appendix for reconciliation of non-GAAP measures
Corporate Responsibility
Acquisition-Related Stock-Based
and Other Costs Compensation IP-Related
Gross Margin Non-GAAP (A) (B) Costs GAAP
Acquisition-Related Stock-Based
and Other Costs Compensation IP-Related
Gross Margin Non-GAAP (A) (B) Costs GAAP
Acquisition-Related Stock-Based
and Other Costs Compensation IP-Related
Gross Margin Non-GAAP (A) (B) Costs GAAP
Operating
Acquisition-Related Stock-Based
Margin
and Other Costs Compensation
($ in Millions &
Margin Percentage) Non-GAAP (A) (B) Other GAAP
$3,617 (13) (391) (3) $3,210
FY 2018
37.2% (0.2) (4.0) — 33.0%
A. Consists of amortization of acquisition-related intangible assets, inventory step-up, transaction costs, compensation charges, and other costs
B. Stock-based compensation charge was allocated to cost of goods sold, research and development expense, and sales, general and administrative expense
C. Comprises of IP-related costs, legal settlement costs, contributions, and restructuring and other charges
Reconciliation of Non-GAAP to GAAP Financial Measures (contd.)
Operating Acquisition-
Margin Related and Stock-Based
($ in Millions & Acquisition Other Costs Compensation
Margin
Percentage) Non-GAAP Termination Cost (A) (B) Other GAAP
$5,628 -- (325) (894) (9) $4,400
1H FY22
46.3% -- (2.7) (7.3) (0.1) 36.2%
A. Consists of amortization of acquisition-related intangible assets, inventory step-up, transaction costs, compensation charges, and other costs
B. Stock-based compensation charge was allocated to cost of goods sold, research and development expense, and sales, general and administrative expense
C. Comprises of IP-related costs, legal settlement costs, contributions, and restructuring and other charges
Reconciliation of Non-GAAP to GAAP Financial Measures (contd.)
Acquisition- Stock-
Acquisition Related and Based
Termination Other Costs Compensation Other Tax Impact of
Non-GAAP Cost (A) (B) (C) Adjustments GAAP
Q2 FY2023
Operating
income $1,325 -- (175) (649) (2) -- $499
($ in million)
Net income
$1,292 -- (175) (649) (9) 197 $656
($ in million)
Shares used
in diluted
per share 2,516 — — — — — 2,516
calculation
(millions)
A. Consists of amortization of intangible assets, transaction costs, and certain compensation charges.
B. Stock-based compensation charge was allocated to cost of goods sold, research and development expense, and sales, general and administrative expense.
C. Other comprises of contributions and net losses from non-affiliated investments
Reconciliation of Non-GAAP to GAAP Financial Measures (contd.)
Impact of stock-based compensation expense, acquisition-related costs, and other costs (2.6%)