2018 Nvidia Corporation Annual Review
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2018 NVIDIA CORPORATION ANNUAL REVIEW NOTICE OF ANNUAL MEETING PROXY STATEMENT FORM 10-K GPUS ARE POWERING SOME OF THE HOTTEST TRENDS NOW AND FOR DECADES TO COME. YAHOO FINANCE Scientists using GPU computing were able to “see” gravitational waves for the first time in human history. Twenty-five years ago, we set out to transform computer graphics. Fueled by the massive growth of the gaming market and its insatiable demand for better 3D graphics, we’ve evolved the GPU into a computer brain at the intersection of virtual reality, high performance computing, and artificial intelligence. NVIDIA GPU computing has become the essential tool of the da Vincis and Einsteins of our time. For them, we’ve built the equivalent of a time machine. Jensen Huang CEO and Founder, NVIDIA Hellblade: Senua’s Sacrifice, as captured by NVIDIA Ansel, a powerful in-game camera that lets users take professional- grade photographs of their games. NVIDIA GEFORCE HAS MOVED FROM GRAPHICS CARD TO GAMING PLATFORM. FORBES At $100 billion, computer gaming is the world’s largest entertainment industry. And with 200 million gamers, NVIDIA GeForce is its largest platform. We continuously innovate across the GeForce platform, from GeForce GTX GPUs to GeForce Experience, and in new technologies like Max-Q that make gaming laptops thinner, quieter and faster. And we’re opening high-end gaming and blockbuster titles to millions of users for the first time with NVIDIA GeForce NOW, a cloud-based service that turns everyday PC and Mac laptops into virtual GeForce gaming machines. NVIDIA’S LATEST TECH IS HERE TO BLOW POSSIBILITIES OF VR WIDE OPEN. ALPHR NVIDIA’s decades-long leadership in computer graphics continues its push into the future with NVIDIA Holodeck, a photorealistic, collaborative VR environment that incorporates the feeling of real-world presence through sight, sound, and haptics. It allows creators to import high-fidelity, full-resolution models into VR to collaborate and share with colleagues or friends. A future where we create nearly everything in a virtual world is on the near horizon. NVIDIA HAS EMERGED AS THE DE FACTO STANDARD IN AI. MARKETWATCH Artificial intelligence is the use of computers intelligence into trillions of computing to simulate human intelligence. AI amplifies devices and be the single largest our cognitive abilities, letting us solve opportunity the industry has ever problems where the complexity is too known. We expect AI to spur a wave great, the information is incomplete, of social progress unmatched since or the details are too subtle and require the industrial revolution. expert training. NVIDIA Volta, the world’s most powerful Learning from data—a computer’s GPU computing architecture, was built version of life experience—is how AI to drive the next wave of AI and HPC. evolves. GPU computing powers the Every major cloud service provider computation required for deep neural now offers Volta instances, and networks to learn to recognize patterns every major computer maker from massive amounts of data (like offers Volta-based servers for identifying more than 7000 flower types on-premise data centers. per second). This new computing model sparked the AI era and will infuse NVIDIA DRIVE PX Pegasus will enable Level 5 driverless vehicles. A supercomputer the size of a license plate, Pegasus delivers 320 TOPS of deep learning performance. Autonomous vehicles will modernize the $10 trillion transportation industry—making our roads safer and our cities more efficient. NVIDIA DRIVE is a scalable AI car platform that spans the entire range of autonomous driving, from traffic-jam pilots to robotaxis. More than 320 companies have adopted NVIDIA DRIVE technology in their data centers and vehicles. They range from car companies and suppliers, to mapping and sensor companies, to startups and research organizations. NVIDIA IS TAKING THE AUTO INDUSTRY BY STORM. U.S. NEWS & WORLD REPORT DEAR NVIDIANS AND STAKEHOLDERS, GPU COMPUTING HAS TAKEN HOLD. What began 25 years ago with our work in computer graphics has evolved to address some of the most important technological trends the world has ever seen. From gaming to AI and from self-driving cars to supercomputers, we approach all of our work and exploration with a common philosophy: focus on the hardest problems that only we can solve. We’re enabling the most demanding computer users in the world—scientists, designers, artists, and gamers—to do their life’s work. Our computers let them create and see the future. To them, NVIDIA has built a time machine. OUR COMPANY IS AT THE EPICENTER OF THE MOST PROMISING ADVANCEMENTS OF OUR AGE Revenue for the year was up 41% to reach in Holodeck, with collaborators beaming developers use the NVIDIA architecture a record $9.71 billion, and gross margins in from remote locations as artificial from end-to-end for fast training and expanded to 59.9%. GAAP earnings per intelligence robots assist them. For cloud-scale deployment. share were $4.82, up 88%. And we the 10th consecutive year, every movie Someday, every car will be autonomous. returned $1.25 billion to shareholders nominated for Best Visual Effects at Machines that move—from cars, taxis, through dividends and stock repurchases. the Academy Awards was created trucks, shuttles, delivery bots, and using NVIDIA. Our gaming business grew 36% this year drones, to agriculture and construction to a record $5.51 billion. Gaming will be AI fueled our datacenter business, equipment—will operate autonomously the world’s largest entertainment medium which grew 133% to reach $1.93 billion. or help drivers operate more safely and someday, with ever-expanding genres, In the near future, software development easily. We created the NVIDIA DRIVE rich characters and stories, and incredible will require large supercomputers that autonomous vehicle platform to enable production values. Gaming can be a sport, are continuously training software to be the $10 trillion transportation industry an adventure, a puzzle, a battle, or just a smarter and do more. The AI software to realize this future. Doing this at a global way to connect with friends in a virtual stack is essentially a giant learning scale is an incredible challenge—one world. Gaming is essentially virtual reality machine running software that writes that NVIDIA is perfectly suited to tackle. and the possibilities are endless. We new software. Volta is the first GPU We create the autonomous car computer, extended our leadership in gaming with created for these AI supercomputers, the “brains” of the vehicle, from processor new innovations like Max-Q, a design and it reduces the learning cycle from to AI and robotics software. We create approach to make GeForce gaming laptops days to hours. Its new Tensor Core the development environment, from amazingly thin and quiet; GeForce architecture boosts deep learning AI training to virtual reality driving Experience ShadowPlay Highlights, which performance by almost 10 times. simulation. NVIDIA DRIVE is the most automatically records and shares players’ Volta-based Tesla V100 accelerators complex computer system we have ever heroic moments; and GeForce NOW, a are now available through every major built, and NVIDIA builds the most complex cloud-based service that turns ordinary computer maker and have been chosen computer systems in the world. Solving laptops into powerful gaming machines. by every major cloud service provider this challenge will greatly benefit society. NVIDIA is the largest computer graphics to deliver AI and high-performance In all, more than 320 automakers, ride- company in the world, seeing double-digit computing. We also introduced the hailing services, startups, mapping growth in our professional visualization breakthrough TensorRT3 neural machine companies, sensor makers, and research business and advancing the field with optimizing compiler to deploy trained universities—in every geography—have our introduction of the Holodeck virtual models at gigantic scale in cloud adopted NVIDIA DRIVE to build the reality design studio. We imagine a future datacenters. The combination of NVIDIA autonomous future. where products will be entirely designed Tesla V100 and TensorRT lets AI REVENUE GROSS MARGINS OPERATING MARGINS EPS +41% +110 bps +500 bps +88% $12 61% 40% $5 $4.82 $9.71 B 33.0% 60% 59.9% $4 $9 30% s 59% $3 n o i l l i $6 20% B n i 58% $2 $3 10% 57% $1 $0 56% 0% $0 FY17 FY18 FY17 FY18 FY17 FY18 FY17 FY18 GAAP results CARING FOR OUR COMMUNITIES GRAND CHALLENGES Our ultimate purpose is to build a Within NVIDIA, we believe a diverse, Twenty-five years ago we set out to solve company that makes a great and positive inclusive culture enables us to innovate, 3D graphics and virtual reality for video impact on the world. We strive to make create groundbreaking products, and games, because it would be one of the singular and valuable contributions to build one of the world’s great technology great, and fun, computing challenges of human progress. We play the long game, companies. It all starts with attracting all time. We believed it would lead us to balancing short-term profits and the diverse talent and creating an environment discover new technologies and build an dream of building a wonderful future. We where the best people can do their life’s engineering machine of great capability. take pride in our social and environmental work. We want to create a company where We were right. The challenges of responsibility. But beyond responsibility, great people can enrich their lives and simulating the virtual worlds of video we are truly joyed and privileged to care build their families. This year, we greatly games share much in common with the for our employees and families, our expanded our parenting benefits to challenges a scientist faces in simulating partners, and our communities who make fund adoptions, in vitro fertilization, molecules or discovering new materials.