By a wide margin, 2016 was Nvidia’s best year on the books. The company’s stock more than quadrupled, and revenue for the year was up 38% over 2015.
In an earnings call with investors on Thursday, longtime Nvidia CEO Jen-Hsun Huang credited the company’s success to a perfect alignment between their core graphics processor business and the needs of the nascent artificial-intelligence field.
“At this point deep learning and AI has really become how future software development is going to be done for a large number of industries,” Huang said. “A lot of people credit the work that we’ve done with our programmable GPUs and our GPU computing platform and the early collaboration with deep learning.”
Nvidia has already inked deals with most major technology firms, many of which were announced last year, as AI hype reached a fever pitch. Now the company needs to convince the rest of the world that they too need access to the same processing power as Facebook and Google.
Nvidia is already targeting healthcare, retail, finance, and transportation as areas of growth, according to CFO Colette Kress. Each of these industries has been recently upended by machine learning—AI can now detect cancer faster than humans by learning from medical imagery, and high-volume stock trading is regularly conducted via algorithm. Rather than rely on the cloud services that buy Nvidia’s products, the company is hoping to convince these sectors to invest in the technology themselves.
But for now at least, gaming is Nvidia’s primary breadwinner, accounting for nearly 60% of its revenue. The continued success of selling gaming graphics cards has been boosted by the recent popularity of e-sports and games like Overwatch, says Huang. Nvidia recently released a line of lower-cost, high-performance GPUs that make PC gaming slightly more accessible.
“My expectation is that the eSports along with AAA titles that are coming out this year is going to keep PC gaming continue to grow,” Huang said. “I don’t remember the last time that a large business the size of ours, and surely the size of a Datacenter business, grew by a factor of three.”