GenAI Revenue Soars Like Never Before
Astounding revenue surges are like finding a winning lottery ticket in an old black leather jacket. This week, NVIDIA announced its quarterly revenue for FY25 Q1, reporting a record-breaking 629% year-over-year increase , with revenue up 261.11% ($26 billion) , fueled by advancements in generative AI.
There is no stopping NVIDIA . Its data centre revenue alone was $22.6 billion – a record-breaker again – up 23% sequentially and 427% YoY, driven by continued strong demand for the NVIDIA Hopper GPU computing platform across data centres, cloud providers, and enterprise customers.?
While Google , Microsoft , AWS , Apple , and Meta , alongside Intel and AMD , are investing heavily in developing custom chips to run AI workloads, experts believe they will never be able to catch up with NVIDIA, as it controls a whopping 95% of the AI chip market.?
In the earnings call, Huang said that the company will build a new chip every year. “I can announce that after Blackwell, there’s another chip. We’re on a one-year rhythm,” he added, saying that the Blackwell platform is in full production and forms the foundation for trillion-parameter scale generative AI.
NVIDIA’s moat leads us to its ‘complex product design and manufacturing' and continuous innovation. When the competitors attempt to catch up on one product, the company smoothly advances to the next, ensuring it maintains a technological and competitive edge.?
Not just NVIDIA, cloud companies have also reported a jump in revenue, thanks to generative AI. In the recent quarter, Microsoft Azure's cloud revenue was $26.7 billion , up 23% YoY. Google Cloud reported $9.6 billion , up 28.43% YoY. On the other hand, AWS reported a revenue of $25.04 billion in Q1 2024 , up 13% from the fourth quarter of the previous year.
Fuels Big Tech Revenue Growth?
Microsoft's FY24 Q1 revenue increased 17% to $61.9 billion, driven by strong cloud and generative AI product performance. ?
Meanwhile, Alphabet saw a 15% revenue increase to $80.5 billion, powered by strong performance in Search, YouTube, and cloud. Significant strides in generative AI led to a promising Gemini era.
Amazon , on the other hand, recorded a 13% increase in FY 24 Q1, touching $143.3 billion, with the AWS segment up 17%. This reflects strong growth across all business areas and a significant boost from infrastructure modernisation and generative AI capabilities.
Meanwhile, Meta's Q1 2024 earnings surged with a 27% revenue increase to $36.46 billion and a dramatic 117% rise in net income, driven by robust growth in generative AI and metaverse initiatives.
Data & Analytics Firms Celebrate??
Snowflake recently announced quarterly revenue of $790 million , up 34% year over year after it focused on generative AI. In contrast, the total revenue in Q1 2021 was $228.9 million.
On the other hand, in 2024, Databricks reached a revenue run rate of $1.9 billion, with a year-over-year growth rate of 26.67%. The company reported $1.6 billion in revenue for the fiscal year ending January 31, 2024, representing over 50% YoY growth.
Databricks' India arm also recorded an 80% annualised growth over the past two fiscal years, from February 1, 2022, to January 31, 2024. The company attributes this surge to the rising demand for data and AI capabilities among Indian enterprises.?
IT Service Providers Rejoice?
In its latest quarter, Accenture reported a revenue of $15.8 billion and a record $21.6 billion in new bookings, showcasing strong generative AI growth and strategic investments. Over the last two quarters, the company has accumulated $1.05 billion in generative AI projects.
Genpact, on the other hand, reported a 4% increase in Q1 2024 revenues to $1.13 billion, with significant execution improvements in data, generative AI, and digital operations.
Meanwhile, TCS reported GenAI deals worth $900 million in Q4 FY24 . Other Indian IT firms—Wipro, Infosys, LTIMindtree, and HCLTech—are still figuring it out with mixed GenAI emotions.?
Industry projections: As per a forthcoming AIM Research report, the total market for generative AI is expected to grow at a compound annual growth rate (CAGR) of 40.22% from 2023 to 2033. Furthermore, companies in the services sector are anticipated to experience a slightly higher CAGR of 45%, indicating a faster expansion compared to the overall market.?
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5 个月Such remarkable growth is truly inspiring.
GEN AI Evangelist | #TechSherpa | #LiftOthersUp
5 个月AI's exponential growth is mind-blowing. Sharing diverse perspectives helps navigate its impacts responsibly. Bhasker Gupta