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Nvidia’s Shares Soar 5% on Strong Sales

Inside The 2016 Consumer Electronics ShowInside The 2016 Consumer Electronics Show
Nvidia CEO Jen-Hsun HuangPatrick T. Fallon/Bloomberg/Getty Images

(Reuters) – Nvidia reported better-than-expected quarterly profit and revenue, driven by higher demand for its graphics chips, sending its shares (NVDA) up more than 5% in extended trading.

The company has weathered a shrinking personal computer industry by focusing on game enthusiasts, who are willing to pay hundreds of dollars for processors used in playing graphically demanding games.

“We are enjoying growth in all of our platforms — gaming, professional visualization, datacenter and auto,” Chief Executive Jen-Hsun Huang said.

Revenue from its gaming business, which designs graphics cards such as GeForce for PCs, rose 17% to $687 million.

The company’s auto unit, which makes chips and software that power dashboard displays of vehicles, performed even better, with revenue surging 46.7% to $113 million.

Nvidia’s net income rose to $196 million, or 33 cents per share, in the first quarter ended May 1 from $134 million, or 24 cents per share, a year earlier.

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Excluding items, the company earned 46 cents per share.

Analysts on average had expected a profit of 32 cents per share, according to Thomson Reuters I/B/E/S.

Revenue rose 13.4% to $1.31 billion, topping expectations of $1.26 billion.

The company said it expects second-quarter revenue to be $1.35 billion, plus or minus 2%. Analysts were expecting $1.28 billion for the quarter.