TLDR
- Nvidia’s automotive revenue reached $570 million in Q4, up 103% year-over-year
- Automotive segment revenue rose to $1.7 billion for the fiscal year, up 55%
- Nvidia CFO expects automotive vertical revenue to grow to approximately $5 billion this fiscal year
- Toyota, Continental, Aurora, and Hyundai recently announced partnerships with Nvidia for autonomous driving technology
- CEO Jensen Huang predicts autonomous vehicles will become “the first multitrillion-dollar robotics industry”
Nvidia’s automotive business is gaining momentum as the chipmaker’s vehicle technology revenue doubled in the last quarter. The company reported that its fourth-quarter automotive revenue reached $570 million.
This represents a 27% increase from the previous quarter. More impressively, it marks a 103% jump from the same period a year ago.
For the full fiscal year, Nvidia’s automotive revenue climbed 55% to $1.7 billion. This growth comes as the company expands beyond its core AI computing business.
CFO Colette Kress shared optimistic projections during the earnings call. She stated that “Nvidia’s automotive vertical revenue is expected to grow to approximately $5 billion this fiscal year.”
While Nvidia’s automotive division represents just 1.45% of the company’s total revenue, it’s growing rapidly. The segment has now generated above $1 billion in annual revenue for the second straight year.
The growth comes from Nvidia’s expanding partnerships with major automakers. Toyota, the world’s largest car manufacturer, will use Nvidia’s DRIVE AGX Orin chip in its next-generation vehicles.
Toyota will also implement Nvidia’s DriveOS operating system. These technologies will power advanced driver assistance features in upcoming Toyota models.
German tire and auto supplier Continental announced a new partnership as well. They will work with self-driving truck company Aurora to use Nvidia’s DRIVE hardware and DriveOS software.
This technology will power Aurora Driver, Aurora’s level 4 autonomous driving system. Continental and Aurora plan to bring autonomous trucks to roads by 2027.
Korea’s Hyundai Motor Group is another new partner. They will use Nvidia technologies to speed up autonomous vehicle and robotics development.
These new deals add to Nvidia’s existing automotive partnerships. The company’s chips already power self-driving technologies at Mercedes, Volvo, China’s BYD, and device maker Foxconn.
Nvidia chips are also used in some of Tesla’s supercomputers. This growing list of partnerships shows the industry’s confidence in Nvidia’s automotive technology.
CEO sees enormous potential in automotive market
CEO Jensen Huang sees enormous potential in this market. During a CES interview with Yahoo Finance, he noted: “If just right now where the self-driving car business is, if it’s already a $5 billion business for us, imagine how big it’s going to be when we have a hundred million new cars per year.”
Huang pointed out the scale of the opportunity. “A trillion miles driven per year. This is likely going to be one of the largest robotics industries in the world and one of the largest computing industries in the world.”
The technology builds on Nvidia’s graphics processing expertise. Huang explained that autonomous vehicles require training on “a mountain of data, video data.” Nvidia’s graphics chips, originally designed for video games, excel at processing this type of information.
They can also run simulations to train autonomous vehicles. This allows car companies to test self-driving systems virtually before deploying them on real roads.
Industry analysts are taking notice of Nvidia’s automotive progress. Brady Wang, semiconductor analyst at Counterpoint Research, highlighted the company’s growing role in “powering ADAS, autonomous vehicles, and robotics through its DRIVE platform and related technologies.”
Gene Munster, managing partner at Deepwater Asset Management, described the automotive and robotics segment as “getting ready to take off.” He credits this to investments in autonomous vehicles from companies like Waymo and Tesla.
Munster also noted around 15 companies are developing humanoid robots. This could further increase demand for Nvidia chips in the robotics sector.
Several Chinese electric car companies have already adopted Nvidia’s technology. BYD, Nio, and Zeekr all use Nvidia’s driver-assist chip systems in their vehicles.
During his CES keynote, Huang made a bold prediction about the future of this industry. “The [autonomous vehicle] revolution has arrived,” he declared. “I predict that this will likely be the first multitrillion-dollar robotics industry.”
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