01—Abstract
Summary
Summary of the 10-K filed February 28, 2018. Cited figures are marked; the original filing is the authoritative source.
NVIDIA Corporation's (NVDA) 2018 10-K filing showcases a year of robust growth, driven by strong performance in its core GPU business and significant expansion in the datacenter and automotive sectors.
The company reported a 41% increase in revenue to $9.71 billiona, largely fueled by demand for its gaming GPUs, a surge in datacenter revenue up 133%, and continued growth in professional visualization and automotive applications. The company is strategically positioned at the intersection of gaming, professional visualization, datacenter, and automotive markets, leveraging its GPU and CUDA architecture as foundational building blocks.
NVIDIA's significant investment in R&D continues to drive innovation, particularly in Artificial Intelligence (AI), which is becoming a central pillar of its platform strategy. The filing highlights NVIDIA's commitment to returning capital to shareholders through dividends and share repurchases, demonstrating financial discipline alongside aggressive growth initiatives.
02—Key points
Key Highlights
- Revenue surged by 41% year-over-year to $9.71 billion, demonstrating strong market demand across key segments.
- The Datacenter segment experienced exceptional growth, increasing revenue by 133% to $1.93 billion, driven by demand for AI and HPC solutions.
- Gaming GPU revenue saw significant growth, exceeding 20%, supported by new product releases and a growing esports market.
- The Tegra Processor business revenue increased by 86% to $1.53 billion, boosted by contributions from gaming consoles and automotive applications.
- NVIDIA is significantly investing in R&D, with expenses totaling $1.80 billion for fiscal year 2018, underscoring its commitment to innovation in AI and GPU computing.
- The company returned $1.25 billion to shareholders in fiscal year 2018 through share repurchases and dividends, with plans to continue this capital return program.
- International revenue accounted for a substantial 79% of total revenue, highlighting NVIDIA's global market presence.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2018, NVIDIA Corp kept $0.31.
- Revenue$9.71B100.0%
- Cost of revenue−$3.89B40.1%
- Gross profit$5.82B59.9%
- Operating costs−$2.61B26.9%
- Operating income$3.21B33.0%
- Interest, other & tax−$163.0M1.7%
- Net income$3.05B31.4%
Where FY2018 revenue went
$9.71B- Cost of revenue: $3.89B, 40% of revenue
- Net income: $3.05B, 31% of revenue
- R&D: $1.80B, 18% of revenue
- SG&A: $815.0M, 8.4% of revenue
- Interest, other & tax: $163.0M, 1.7% of revenue
Kept 31% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2018filed February 28, 2018Financial Statements
FY2018 against FY2017
| Line item | FY2018FY2017 | Change |
|---|---|---|
| Revenue | $9.71B$6.91B | +40.6% |
| Cost of Revenue | $3.89B$2.85B | +36.7% |
| Gross Profit | $5.82B$4.06B | +43.3% |
| R&D Expenses | $1.80B$1.46B | +22.8% |
| SG&A Expenses | $815.00M$663.00M | +22.9% |
| Operating Expenses | $2.61B$2.13B | +22.7% |
| Operating Income | $3.21B$1.93B | +66.0% |
| Interest Expense | $61.00M$58.00M | +5.2% |
| Net Income | $3.05B$1.67B | +82.9% |
| EPS (Basic) | $0.13$0.08 | +65.3% |
| EPS (Diluted) | $0.12$0.06 | +87.5% |
| Shares Outstanding (Basic) | 23.96B21.64B | +10.7% |
| Shares Outstanding (Diluted) | 25.28B25.96B | −2.6% |
05—Questions
Frequently Asked Questions
What are NVIDIA's primary business segments and key markets?
NVIDIA operates primarily through two reportable segments: GPU and Tegra Processor. These segments serve four key markets: Gaming, Professional Visualization, Datacenter, and Automotive. The company's unified GPU and CUDA architecture serves as the foundation for its offerings across these diverse markets.
How is NVIDIA positioning itself for future growth, particularly in the context of Artificial Intelligence (AI)?
NVIDIA is extending its technology and platform leadership in AI, viewing deep learning as fundamental to its evolution. The company offers a comprehensive end-to-end GPU computing platform for AI, encompassing GPUs, its CUDA programming language, algorithms, libraries, and system software. Its strategy involves enhancing GPU architecture with AI-specific features and fostering a large ecosystem of developers and partners to accelerate AI adoption across various industries.
What is NVIDIA's strategy for returning capital to shareholders?
NVIDIA is committed to returning capital to shareholders through a combination of ongoing quarterly cash dividends and share repurchases. In fiscal year 2018, the company returned $1.25 billion to shareholders and announced plans to return a similar amount in fiscal year 2019 through these programs. The dividend policy and future payments are subject to the Board of Directors' determination of what is in the best interests of shareholders.
What are the key risks highlighted in the filing related to NVIDIA's business operations?
Key risks include the need to continually adapt to evolving market needs and technological changes, intense competition, potential system security and data protection breaches, the risk of product defects, reliance on third-party manufacturers, and the possibility of failing to achieve design wins. The company also faces risks associated with international operations and supply chain disruptions.
06—Continue