Nvidia scored another round of record-breaking profits in the first fiscal quarter of 2021, reporting over $5.66 billion in revenue as of May 2. The company's gaming services accounted for nearly half of that revenue, $2.76 billion, despite a shortage of graphics processing units (GPUs). The company's datacenter services also experienced a significant boost in revenue as more companies continue to transition facets of their business online.

This time last year, right before the COVID-19 pandemic swept across the globe, Nvidia recorded an overall revenue of $3.1 billion, according to VentureBeat. As people around the world began to rely on virtual services, Nvidia was one of many tech companies that began to see revenue increase as other sectors experienced setbacks. Nvidia CEO Jensen Huang said in an interview with VentureBeat this April that Q1 2021 was no different, and a strong demand for its growing AI and graphics processing services were key to the company's success.

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While the company is seeing record revenues, it still faces challenges when it comes to filling the increased demand for GPUs. Nvidia's GPU shortage comes from two problems. The pandemic has halted manufacturing around the globe, making the materials that go into GPUs like silicon chips and semiconductors harder to come by and more expensive to acquire. The other problem stems from an increase in cryptocurrency mining, which means that miners or sometimes even bots are buying up all of the available GPUs, skyrocketing the price for gamers.

Nvidia is addressing the GPU shortage in several ways, including setting a purchase limit on certain GPUs, evaluating orders to check for bots, and dividing their available stock of GPUs into cryptocurrency and gaming-specific categories. Despite these efforts, Nvidia and other companies predict the GPU shortage isn't going away soon. In the meantime, the company is making moves in other sectors of the economy.

Nvidia's $7 billion acquisition of Mellanox last year provided a huge boost to its datacenter services, and the company primarily known for its gaming graphics cads is in the process of acquiring processor architecture firm Arm for $40 billion. This quarter the company also recently unveiled a new AI processor for automated vehicles, called Nvidia Drive Atlan, although revenue in this sector was down slightly from the previous year.

The outlook for Q2 2021 is also bright for Nvidia. Financial experts predict that the graphics company's revenue next quarter will outpace this quarter and hit about $6.3 billion, according to VentureBeat. Nvidia has also continued to release new graphics cards despite the shortage, with the release of the Nvidia RTX 3080 Ti expected at the end of May.

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Source: VentureBeat