UPDATE 4-Nvidia's upbeat forecast powered by data center, cryptocurrency demand

From Reuters - February 8, 2018

(Reuters) - Nvidia Corps (NVDA.O) upbeat current-quarter revenue forecast on Thursday underscored surging demand for its graphics chips used in data centers, gaming devices and cryptocurrency mining, sending its shares up as much as 12 percent in extended trading.

The company, which also reported better-than-expected quarterly results, is reaping the benefits from the launch of its Volta chip architecture last year. Volta processors power a range of technologies such as artificial intelligence and driverless cars.

Virtually every internet and cloud service provider has embraced our Volta GPUs, Nvidias Chief Executive Officer Jensen Huang said in a statement.

Graphic chips were initially developed to handle graphics for high end video games and other computers. These chips help share the processing load from the main chip, making it easier and faster to run high end applications.

These chips are now being widely use in new technologies, like artificial intelligence, machine learning.

Revenue from Nvidias widely watched data center business, which counts Microsoft Corps (MSFT.O) Azure cloud business as its customer, more than doubled to $606 million.

That trounced analysts average estimate of $541.1 million.

Nvidia also sells chips to Incs (AMZN.O) Amazon Web Services (AWS), which is dueling with Microsoft to handle data and computing for large enterprises

Data center should continue to grow pretty nicely into calendar 2018 and beyond, Morningstar analyst Abhinav Davuluri said.

The boom in cryptocurrencies is also powering demand for chips from Nvidia and rival AMD (AMD.O) as they provide the high computing ability required for cryptocurrency mining.

Strong demand in the cryptocurrency market exceeded our expectations, Chief Financial Officer Colette Kress said on a conference call.


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