01—Abstract
Summary
Summary of the 10-K filed March 1, 2017. Cited figures are marked; the original filing is the authoritative source.
NVIDIA Corporation (NVDA) demonstrated significant growth and strategic positioning in its fiscal year 2017 filing, highlighting a substantial increase in revenue driven by strong performance across its key market platforms: Gaming, Professional Visualization, Datacenter, and Automotive.
The company's strategic emphasis on Artificial Intelligence (AI) and its underlying GPU technology proved to be a major catalyst, particularly in the booming datacenter market where demand for deep learning applications surged. Financially, NVIDIA reported robust revenue growth of 38%a year-over-year, coupled with a significant improvement in profitability, evidenced by a 171% increase in net income. This financial strength was supported by an expanding gross margin and efficient management of operating expenses.
The company also returned substantial capital to shareholders through dividends and share repurchases, underscoring its commitment to shareholder value and its confidence in future cash flows. NVIDIA's investment in R&D remains a core focus, essential for maintaining its technological leadership in visual computing and AI.
02—Key points
Key Highlights
- Revenue grew 38% to $6.91 billion, driven by strong demand across Gaming, Professional Visualization, Datacenter, and Automotive markets.
- Net income surged by 171% to $1.67 billion, reflecting improved operational efficiency and strong sales performance.
- The GPU business saw a 39% revenue increase, largely fueled by high-end GeForce gaming GPUs and significant growth in Datacenter platforms due to AI and deep learning demand.
- Tegra Processor business revenue grew 47%, primarily driven by automotive applications and gaming development platforms.
- Gross margin improved to 58.8% from 56.1% in the prior year, attributed to a favorable product mix and higher-margin product sales.
- NVIDIA returned $1.00 billion to shareholders in fiscal year 2017 through share repurchases and dividends, with plans to return $1.25 billion in fiscal year 2018.
- Research and development expenses increased by 10% to $1.46 billion, reflecting continued investment in innovation for AI and visual computing.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2017, NVIDIA Corp kept $0.24.
- Revenue$6.91B100.0%
- Cost of revenue−$2.85B41.2%
- Gross profit$4.06B58.8%
- Operating costs−$2.13B30.8%
- Operating income$1.93B28.0%
- Interest, other & tax−$268.0M3.9%
- Net income$1.67B24.1%
Where FY2017 revenue went
$6.91B- Cost of revenue: $2.85B, 41% of revenue
- Net income: $1.67B, 24% of revenue
- R&D: $1.46B, 21% of revenue
- SG&A: $663.0M, 9.6% of revenue
- Interest, other & tax: $268.0M, 3.9% of revenue
Kept 24% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2017filed March 1, 2017Financial Statements
FY2017 against FY2016
| Line item | FY2017FY2016 | Change |
|---|---|---|
| Revenue | $6.91B$5.01B | +37.9% |
| Cost of Revenue | $2.85B$2.20B | +29.5% |
| Gross Profit | $4.06B$2.81B | +44.5% |
| R&D Expenses | $1.46B$1.33B | +9.9% |
| SG&A Expenses | $663.00M$602.00M | +10.1% |
| Operating Expenses | $2.13B$2.06B | +3.1% |
| Operating Income | $1.93B$747.00M | +158.9% |
| Interest Expense | $58.00M$47.00M | +23.4% |
| Net Income | $1.67B$614.00M | +171.3% |
| EPS (Basic) | $0.08$0.03 | +172.6% |
| EPS (Diluted) | $0.06$0.03 | +138.0% |
| Shares Outstanding (Basic) | 21.64B21.72B | −0.4% |
| Shares Outstanding (Diluted) | 25.96B22.76B | +14.1% |
05—Questions
Frequently Asked Questions
What are NVIDIA's key growth drivers according to this filing?
NVIDIA's primary growth drivers are its GPU technology powering significant advancements in Artificial Intelligence (AI) and deep learning, leading to strong demand in the Datacenter market. Growth is also robust in the Gaming sector, supported by new GPU architectures and virtual reality (VR) adoption. The Automotive market is emerging as a significant growth area with the development of AI-powered autonomous driving systems.
How did NVIDIA's financial performance look in FY2017?
NVIDIA showed impressive financial performance in FY2017. Revenue increased by 38% to $6.91 billion. Net income saw a substantial rise of 171% to $1.67 billion, and diluted earnings per share grew to $2.57 from $1.08 in the previous year. The company also improved its gross margin to 58.8% and significantly increased its cash and marketable securities balance to $6.80 billion.
What is NVIDIA's strategy regarding Artificial Intelligence (AI)?
NVIDIA's strategy centers on extending its technology leadership in AI by providing a complete, end-to-end GPU computing platform for deep learning, encompassing GPUs, CUDA, algorithms, libraries, and system software. The company is actively engaged with enterprises, cloud service providers, and startups, and offers educational programs like the Deep Learning Institute to foster AI adoption.
How is NVIDIA returning capital to shareholders?
NVIDIA is actively returning capital to shareholders through a combination of increasing quarterly cash dividends and executing a significant share repurchase program. In FY2017, the company returned $1.00 billion and plans to return approximately $1.25 billion in FY2018, demonstrating a strong commitment to shareholder returns.
06—Continue