Market Insider

Nvidia shares spike after profit tops

FooTToo | Getty Images

Nvidia shares spiked 15 percent Friday after the chip-maker posted earnings and guidance well-above analysts' estimates.

Earnings beat consensus by one cent, coming in at 33 cents per share for the first quarter. The chip-maker's profit was up 46 percent from a year earlier, thanks to strong demand and video game players' willing to pay more for high-quality images, the company said.

John Vignocchi, vice president of production at Disney Interactive Studios, speaks about the Disney Infinity 3.0 video game during a Sony Corp. event ahead of the E3 Electronic Entertainment Expo in Los Angeles, California, U.S., on Monday, June 15, 2015.
Why Disney unexpectedly quit video game publishing
Applicants stand inside an Uber Technologies Inc. office during a driver recruitment event in Hong Kong, China, on Tuesday, Dec. 29, 2015.
Uber's China rival lines up mega-tech backers across globe

Full-year revenue forecasts were also higher than Wall Street expected. For the current quarter, the company projected $1.35 billion in revenue versus the Street's average estimates of $1.28 billion.

Revenue for last quarter came in at $1.3 billion, an increase of 13 percent year over year. The company pointed to strength in gaming platforms, where its revenue was up 17 percent year over year at $687 million.

"We are enjoying growth in all of our platforms- gaming, professional visualization, datacenter and auto," Jen-Hsun Huang, co-founder and CEO of Nvidia, said in a statement. "We are excited to bring a new wave of innovations to the markets we serve."

Source: FactSet

Nvidia makes chips called "graphics processing units", or GPUs, that improve the image quality on smart phones, game consoles, and cars. It also specializes in virtual reality.

The Santa Clara-based company released a new graphics card at a media event in Austin, Texas last Friday. The company said the new "Pascal architecture" card is twice as fast, and 40 percent cheaper than the card it's replacing.

Shares of the chip-maker traded closed at $40.98 Friday, up nearly 16 percent this week, and more than 96 percent over the past year.