What Led To The Surge In Nvidia’s Data Center Revenues In Q2’16?

Nvidia‘s (NASDAQ:NVDA) data center revenue stood at $151 million in Q2’16, which translates to a little over 10% of its overall revenues in the quarter. The company’s data center business, which it started reporting as a separate segment only two years ago, has been growing much faster than its overall business. The revenue from the segment has more than doubled in Q2’16 on a year over year basis. In the analysis below we look in detail the factor underlying the strong growth in Nvidia’s data center business: Increased Use of GPUs In Deep Learning Nvidia has been able to enter the server chip market with its GPUs, the application of which is exponentially increasing in hyperscale data centers. The hyperscale data centers are applying deep learning algorithms to enhance their applications and make them smarter. It must be noted that…


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