Slide 1: Investor Presentation Q3 FY2021
INVESTOR PRESENTATION Q3 FY2021 November 23, 2020
Slide 2: Forward-looking statements
Except for the historical information contained herein, certain matters in this presentation including, but not limited to, statements as to: our financial position; our markets; the performance, benefits, abilities and impact of our products and technology; the availability of our products and tech
Slide 3: Content
CONTENT Q3 FY21 Earnings Summary Proposed Acquisition of Arm Key Announcements This Quarter NVIDIA Overview Financials Non-GAAP to GAAP Reconciliation 3
Slide 4: Q3 FY21 Earnings Summary
Q3 FY21 EARNINGS SUMMARY 4
Slide 5: Highlights
HIGHLIGHTS Record quarter, with strong growth led by Gaming and Data Center Total revenue up 57% y/y to $4.73B, ahead of outlook of $4.40B Gaming up 37% y/y to a record $2.27B; Data Center up 162% y/y to a record $1.90B Strong Gaming growth driven by records in desktops, laptops, and game consoles N
Slide 6: Q3 FY2021 Financial Summary
Q3 FY2021 FINANCIAL SUMMARY 5,000 85.0% GAAP Non-GAAP $4,726 4,500 Q3 FY21 Y/Y Q/Q Q3 FY21 Y/Y Q/Q 80.0% 4,000 $3,866 Revenue $4,726 +57% +22% $4,726 +57% +22% 75.0% 3,500 Gross Margin 62.6% -100 bps +380 bps 65.5% +140 bps -50 bps $3,105 $3,080 70.0% $3,014 3,000 65.4% 65.8% 66.0% 65.5% 64.1% Opera
Slide 7: Gaming
GAMING Revenue ($M) Highlights Record revenue for Desktop, Laptop, and 37% q/q and 37% y/y Console $2,400 $2,271 $2,200 Launched GeForce RTX 30 Series GPUs to amazing reviews and overwhelming $2,000 demand; delivers up to 2x performance $1,800 $1,659 $1,654 Launched NVIDIA Reflex to improve $1,600 $
Slide 8: Data Center
DATA CENTER Revenue ($M) Highlights 8% q/q and 162% y/y $2,000 $1,900 Strong ramp of our A100-based platforms, continued growth in Mellanox, and record $1,800 $1,752 T4 shipments for inference $1,600 AWS, Oracle Cloud Infrastructure and Alibaba Cloud announced general $1,400 availability of the A100
Slide 9: Professional Visualization
PROFESSIONAL VISUALIZATION Revenue ($M) Highlights Desktop workstations continued to decline, impacted by COVID-19 $350 $324 $331 Mobile workstations rebounded sharply $307 16% q/q due to work-from-home trends 27% y/y $236 Strength in Healthcare, Public Sector, Higher Education & Research, and $203
Slide 10: Automotive
AUTOMOTIVE Revenue ($M) Highlights $250 Year-on-year decline due to ramp-down of legacy infotainment revenue Sequential growth driven by recovery in $162 $163 13% q/q automotive production volumes and $155 continued growth in AI Cockpit revenue 23% y/y $125 Mercedes-Benz debuted its redesigned S- $1
Slide 11: Sources & Uses of Cash
SOURCES & USES OF CASH Cash Flow from Operations ($M) Highlights $2,200 Paid $2B in cash as part of our announced $2,000 acquisition of Arm $1,800 $1,640 Returned $99M to shareholders in the $1,566 $1,600 $1,465 18% q/q and 22% y/y form of dividends $1,400 $1,279 Invested $473M in capex $1,200 $1,00
Slide 12: Q4 FY2021 Outlook
Q4 FY2021 OUTLOOK Revenue –$4.80 billion, plus or minus two percent We expect Gaming to be up sequentially. We expect Data Center to be down slightly sequentially. We expect continued sequential improvement in Auto and Pro Viz, and a sequential seasonal decline in OEM. Gross Margin – 62.8% GAAP and
Slide 13: Proposed Acquisition of Arm
PROPOSED ACQUISITION OF ARM 13
Slide 14: The Age of AI
THE AGE OF AI From Cloud to Edge Internet Internet of People of Things Cloud Data Centers Edge Data Centers Thousands of DC Millions of Edge DC Each with Millions of Nodes Each with Thousands of Nodes PERSONAL COMPUTING AUTONOMOUS MACHINES Billions of People Trillions of Devices
Slide 15: NVIDIA to Acquire Arm
NVIDIA TO ACQUIRE ARM Creates the premier computing company for the age of AI — combining NVIDIA’s leading AI computing platform with Arm’s vast CPU ecosystem Expands Arm’s IP licensing portfolio with NVIDIA’s technology in large end markets — including Mobile and PCs Turbocharges Arm’s server CPU r
Slide 16: Arm's Financial Profile
ARM’S FINANCIAL PROFILE High Margin, Recurring Revenue Business Model Strong Financial Profile High Quality Business Model Pro forma revenues of ~$1.8B Contract-based, recurring revenues Pro forma gross margin of ~94% 1,765+ licenses, growing by 100+ per year Adjusted EBITDA margin of ~35% 500+ lice
Slide 17: Transaction Summary
TRANSACTION SUMMARY Up to $40B purchase price at the time of signing: • $21.5B in NVIDIA shares TRANSACTION • $12B in cash, with $2B paid at signing CONSIDERATION • $1.5B employee equity for post-closing retention • $5B performance based earn-out paid in cash or up to 10.3M NVIDIA shares FINANCIAL E
Slide 18: Key Announcements This Quarter
KEY ANNOUNCEMENTS THIS QUARTER
Slide 19: GeForce RTX 30 Series
GEFORCE RTX 30 SERIES Based on the New NVIDIA Ampere Architecture Greatest-Ever Generational Leap up to 2x the performance of prior generation 2nd Generation of NVIDIA RTX for real-time ray tracing and AI gaming NVIDIA Reflex for faster game reaction time through lower system latency RAY TRACING — T
Slide 20: NVIDIA Wins Benchmark for AI Inference
NVIDIA WINS BENCHMARK FOR AI INFERENCE Extending its Lead in Latest MLPerf Inference v0.7 Benchmark What is MLPerf? MLPerf October 2020 — AI Inference The industry’s first and only objective standard for NVIDIA won every test across all six application areas measuring machine learning performance fo
Slide 21: NVIDIA Tops MLPerf AI Inference Benchmarks
NVIDIA TOPS MLPERF AI INFERENCE BENCHMARKS A100 Is Up To 237X Faster Than the CPU OFFLINE SERVER Per-Accelerator Normalized to T4 Per-Accelerator Normalized to T4 10x 10x Xilinx U250 (Available) Intel Cooper Lake (Preview) Xilinx U250 (Available) Intel Cooper Lake (Preview) NVIDIA T4 (Available) NVI
Slide 22: Accelerating Adoption of NVIDIA AI Inference
ACCELERATING ADOPTION OF NVIDIA AI INFERENCE Celebrating 10 Years of NVIDIA GPU in the Cloud 7TH GENERATION TensorRT ACCELERATED ADOPTION OF NVIDIA GPU TOTAL CLOUD AI INFERENCE COMPUTE CAPACITY (Inference Compiler) (EXA OPS) (PETA OPS) 166 1,000,000 2000+ Optimizations 100,000 TensorFlow, PyTorch, O
Slide 23: NVIDIA AI Inference Customers
NVIDIA AI INFERENCE CUSTOMERS AUTO CONSUMER INTERNET CSP ROBOTICS MEDICAL RETAIL & FSI INDUSTRIAL
Slide 24: NVIDIA BlueField DPUs
NVIDIA BLUEFIELD DPUs New Processor Enables the Data Center as the New Unit of Computing NVIDIA BlueField-2 DPU - the data processing unit (DPU) is a new class of processor that targets every server alongside the CPU and GPU Out-of-Band Management Supported by NVIDIA DOCA – new “data-center-infrastr
Slide 25: VMware and NVIDIA
VMWARE AND NVIDIA TO ENABLE NEXT-GEN HYBRID CLOUD ARCHITECTURE AND BRING AI TO EVERY ENTERPRISE Delivers an end-to-end enterprise platform for AI – Integrates NVIDIA’s rich set of AI software into VMware vSphere and VMware Cloud Foundation. Allows enterprises to run and manage AI workloads with exis
Slide 26: NVIDIA Clara Discovery
NVIDIA CLARA DISCOVERY $1.25T Pharmaceutical Industry | $2B R&D Per Drug | 12 ½ Years To Market | 90% Failure Rate SEARCH O(1060) A state-of-the-art suite of tools for scientists, with a new Chemical Compounds collection of optimized computational drug discovery applications and frameworks, to disco
Slide 27: NVIDIA Overview
NVIDIA OVERVIEW 27
Slide 28: NVIDIA — A Computing Platform Company
NVIDIA — A COMPUTING PLATFORM COMPANY Headquarters: Santa Clara, CA Headcount: 17,500 NVIDIA pioneered accelerated computing to help solve the most challenging computational problems. The approach is broadly recognized as the way to advance computing as Moore’s law ends and AI lifts off. NVIDIA’s pl
Slide 29: NVIDIA at a Glance
NVIDIA AT A GLANCE Accelerated Computing Pioneer Brief History Revenue by Market Platform 1993: Founded by Jensen Huang, Chris Malachowsky, and Curtis Priem $11.7B $11.7B $10.9B Gaming 1999: IPO on NASDAQ at $12 (prior to 4 stock splits, now 12:1) $9.7B $7.8B Data Center 2001: Xbox win; fastest semi
Slide 30: Growth Drivers
GROWTH DRIVERS Gaming AI AR/VR Self-driving Cars 30
Slide 31: Computing for the Age of AI
COMPUTING FOR THE AGE OF AI NVIDIA RTX NVIDIA HPC NVIDIA HYPERSCALE AI NVIDIA ENTERPRISE AI NVIDIA EDGE AI $8B $10B $45B $30B $15B 2020 Revenue* Data Center Total Addressable Market by 2024 18% Trailing 5-year CAGR *Trailing 4-quarters through F3Q 2021 outlook for Gaming NVIDIA Hyperscale AI include
Slide 32: Our Core Businesses
OUR CORE BUSINESSES FY20 Revenue $5.52B, FY20 Revenue of $2.98B, FY20 Revenue of $1.21B, FY20 Revenue of $700M, 3-year CAGR of 11% 3-year CAGR of 53% 3-year CAGR of 13% 3-year CAGR of 13% Strong market position and Leader in deep learning/AI – 90%+ market share in Current revenue driven technology l
Slide 33: Strong, Profitable Growth
STRONG, PROFITABLE GROWTH F1H16 F1H21 Revenue ($M) Gross Margin Operating Margin Revenue ($M) Gross Margin Operating Margin 12,000 80% 12,000 85% 17 4 4 7 10,000 70% 10,000 6 62% 63% 70% 43 59% 60% 66% 8,000 57% 60% 8,000 61% 54 15 6,000 50% 6,000 55% 42 7 4,000 37% 38% 40% 4,000 40% 34% 32% 40% Gam
Slide 34: Why Accelerated Computing?
WHY ACCELERATED COMPUTING? Advancing Computing in the Post-Moore’s Law Era The world’s demand for computing power 107 continues to grow exponentially, yet CPUs are no longer keeping up as Moore’s Law has ended. GPU PERFORMANCE NVIDIA pioneered GPU-accelerated computing 105 to solve this challenge. O
Slide 35: World Leader in Accelerated Computing
WORLD LEADER IN ACCELERATED COMPUTING Our Four Market Platforms & Key Brands Gaming Data Center Professional Visualization Auto GeForce GPUs for PC Gamers DGX/HGX/EGX for HPC/AI compute Quadro for Workstations DRIVE for Autonomous Vehicles Mellanox for networking 35
Slide 36: Gaming
GAMING GeForce - The World’s Largest Gaming Platform $6,246 #1 in PC gaming with more 18% CAGR $5,513 $5,518 than 3X the revenue of the other major GPU vendor $4,060 Expanding the market with $2,818 gaming laptops and cloud gaming Powering the Nintendo Switch console FY16 FY17 FY18 FY19 FY20 Revenue
Slide 37: Data Center
DATA CENTER High Performance Computing (HPC) and AI NVIDIA Share of New Top 2.5M 500 Systems $2,932 $2,983 72% CAGR 2.0M 70% $1,932 1.5M 41% 34% 1M 24% $830 500K 6% $339 SC16 SC17 SC18 SC19 SC20 0 FY16 FY17 FY18 FY19 FY20 2005 2010 2015 2020 In 8 of top 10 Supercomputers Worldwide; #1 in US, China,
Slide 38: Professional Visualization
PROFESSIONAL VISUALIZATION Workstation Graphics Accelerated AR/VR Data $1,212 Rendering Science 13% CAGR $1,130 Simulation Virtual and Sci Viz Workstations $934 Foundr y $835 $750 Remington FY16 FY17 FY18 FY19 FY20 Revenue ($M) 50+ Applications 40M Designers and Creatives Unlocking New Markets 38
Slide 39: Auto
AUTO Infotainment and Autonomous Vehicles 80 76 $700 TOYOTA MERCEDES-BENZ 22% CAGR $641 70 $558 60 $487 50 42 VOLVO 40 $320 33 30 26 24 20 15 DIDI ZF 10 7 0 Robo FY16 FY17 FY18 FY19 FY20 Cars Trucks Tier 1s taxis Mapping Sensors Software XPENG Revenue ($M) NVIDIA DRIVE Partners Strong Partnership /
Slide 40: Large and Diverse Customer Base
LARGE AND DIVERSE CUSTOMER BASE Reaching Hundreds of Millions of End Users Through Hundreds of Customers Reaching 200M+ PC gamers Cloud 40M Designers/Creatives Every Major PC OEM/ODM HPC ORNL LLNL Piz ABCI Summit Sierra Daint Every Major Graphics Card Vertical Industry Manufacturer 20M Enterprise Us
Slide 41: Financials
FINANCIALS 41
Slide 42: Annual Revenue by Market Platform
ANNUAL REVENUE BY MARKET PLATFORM Gaming Data Center $2,932 $2,983 $6,246 $5,513 $5,518 $mm $mm $4,060 $1,932 $2,818 $830 $339 FY16 FY2016 FY17 FY2017 FY18 FY2018 FY19 FY2019 FY20 FY2020 FY16 FY2016 FY17 FY2017 FY18 FY2018 FY19 FY2019 FY20 FY2020 Pro Visualization Auto $1,212 $700 $1,130 $641 $934 $
Slide 43: Annual Cash & Cash Flow Metrics
ANNUAL CASH & CASH FLOW METRICS ADJUSTED EBITDA (NON-GAAP) OPERATING CASH FLOW $4,662 $4,761 $4,110 $3,803 $3,743 $3,502 $2,392 $mm $mm $1,672 $1,305 $1,175 FY2016 FY16 FY2017 FY17 FY2018 FY18 FY2019 FY19 FY2020 FY20 FY2016 FY16 FY2017 FY17 FY2018 FY18 FY2019 FY19 FY2020 FY20 FREE CASH FLOW CASH BAL
Slide 44: Conservative Financial Policy
CONSERVATIVE FINANCIAL POLICY Key Credit Metrics Financial Policy Highlights Historical Debt / Adjusted EBITDA FY20 1.4 Commitment to maintain our Revenue $10.92B historically modest leverage, 1.2 Adjusted EBITDA $4.11B consistent with investment grade 1 credit ratings Free Cash Flow $4.27B 0.8 Disc
Slide 45: NVIDIA's Commitment to ESG
NVIDIA’S COMMITMENT TO ESG Create a Leading Workplace “Nvidia Stock Wows Wall Street Tackle Climate Change And ESG Investors Too As Best ESG Company” #1 on the Green500 list, Investor’s Business Daily 26/30 super computers Oct. 26, 2020 NVIDIA GPU powered. 45
Slide 46: NVIDIA GPUs Power 26 of 30 Most Energy-Efficient Machines
NVIDIA GPUs POWER 26 OUT OF THE 30 MOST ENERGY-EFFICIENT MACHINES ON THE TOP500 Accelerated computing is the way forward for powerful & efficient supercomputers NVIDIA GPUs and/or InfiniBand power 8 of top 10 systems on latest TOP500 list Fastest systems in US, China, Europe, India, Saudi Arabia, an
Slide 47: Reconciliation of Non-GAAP to GAAP Financial Measures
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES 47
Slide 48: Reconciliation of Non-GAAP to GAAP Financial Measures
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES AMORTIZATION OF NON-GAAP GAAP DEPRECIATION ACQUISITION- ($ IN MILLIONS) OPERATING INCOME ADJUSTED EBITDA & AMORTIZATION RELATED (A) INTANGIBLES FY 2016 $1,125 197 (17) $1,305 FY 2017 $2,221 187 (16) $2,392 FY 2018 $3,617 199 (13) $3,803 FY 2019 $
Slide 49: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) ACQUISITION- NON-GAAP STOCK-BASED PRODUCT GAAP ($ IN RELATED AND OTHER OPERATING COMPENSATION WARRANTY OPERATING MILLIONS) OTHER COSTS (D) INCOME (A) (B) INCOME (C) FY 2016 $1,125 (205) (20) (22) (131) $747 FY 2017 $2,221 (248) — (16) (2
Slide 50: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) ($ IN NON-GAAP STOCK-BASED ACQUISITION- GAAP OTHER MILLIONS) OPERATING COMPENSATION RELATED AND OPERATING (C) INCOME (A) OTHER COSTS (B) INCOME YTD Q3 FY20 $2,515 (624) (22) (13) $1,856 YTD Q3 FY21 $4,714 (981) (669) (39) $3,025 A. Stock
Slide 51: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) ACQUISITION- STOCK-BASED RELATED ITEMS OTHER TAX IMPACT OF ($ IN MILLIONS) NON-GAAP COMPENSATION GAAP AND OTHER COSTS (C) ADJUSTMENTS (A) (B) Q3 FY2021 Revenue $4,726 — — — — $4,726 Gross profit $3,095 (28) (86) (21) — $2,960 Gross margi
Slide 52: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) STOCK-BASED NON-GAAP GROSS PRODUCT OTHER GAAP GROSS COMPENSATION MARGIN WARRANTY (B) (C) MARGIN (A) FY 2016 56.8% (0.3) (0.4) — 56.1% FY 2017 59.2% (0.2) — (0.2) 58.8% FY 2018 60.2% (0.3) — — 59.9% FY 2019 61.7% (0.2) — (0.3) 61.2% FY 20
Slide 53: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) ACQUISITION- STOCK-BASED NON-GAAP RELATED ITEMS OTHER GAAP GROSS COMPENSATION GROSS MARGIN AND OTHER (C) MARGIN (A) COSTS (B) Q3 FY2020 64.1% (0.5) — — 63.6% Q4 FY2020 65.4% (0.4) — (0.1) 64.9% Q1 FY2021 65.8% (0.7) — — 65.1% Q2 FY2021 6
Slide 54: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) ACQUISITION- STOCK-BASED NON-GAAP RELATED ITEMS OTHER GAAP GROSS COMPENSATION GROSS MARGIN AND OTHER (C) MARGIN (A) COSTS (B) YTD Q3 FY20 61.3% (0.4) — (0.1) 60.8% YTD Q3 FY21 65.7% (0.5) (2.8) (0.4) 62.0% A. Stock-based compensation cha
Slide 55: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) ACQUISITION- NON-GAAP STOCK-BASED PRODUCT GAAP RELATED AND OTHER OPERATING COMPENSATION WARRANTY OPERATING OTHER COSTS (D) MARGIN (A) (B) MARGIN (C) FY 2016 22.5% (4.2) (0.4) (0.4) (2.6) 14.9% FY 2017 32.1% (3.6) — (0.2) (0.3) 28.0% FY 2
Slide 56: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) NON-GAAP STOCK-BASED ACQUISITION- GAAP OTHER OPERATING COMPENSATION RELATED AND OPERATING (C) MARGIN (A) OTHER COSTS (B) MARGIN YTD Q3 FY20 32.2% (7.9) (0.3) (0.2) 23.8% YTD Q3 FY21 40.4% (8.4) (5.7) (0.4) 25.9% A. Stock-based compensati
Slide 57: Reconciliation of Non-GAAP to GAAP Financial Measures (Contd.)
RECONCILIATION OF NON-GAAP TO GAAP FINANCIAL MEASURES (CONTD.) PURCHASES OF PROPERTY NET CASH PROVIDED BY ($ IN MILLIONS) AND EQUIPMENT AND FREE CASH FLOW OPERATING ACTIVITIES INTANGIBLE ASSETS FY 2016 $1,175 (86) $1,089 FY 2017 $1,672 (176) $1,496 FY 2018 $3,502 (593) $2,909 FY 2019 $3,743 (600) $3
Slide 58: Reconciliation of GAAP to Non-GAAP Outlook
RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK Q4 FY2021 ($ in millions) Outlook GAAP gross margin 62.8% Impact of stock-based compensation expense, acquisition-related costs, and other costs 2.7% Non-GAAP gross margin 65.5% GAAP operating expenses $1,640 Stock-based compensation expense, acquisition-re