| NVIDIA CORPORATION | ||||||||||||||||||||||
| RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||||
| (In millions, except per share data) | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||
| October 31, | August 1, | October 25, | October 31, | October 25, | ||||||||||||||||||
| 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||
| GAAP gross profit | $ | 4,631 | $ | 4,215 | $ | 2,960 | $ | 12,476 | $ | 7,240 | ||||||||||||
| GAAP gross margin | 65.2 | % | 64.8 | % | 62.6 | % | 64.7 | % | 62.0 | % | ||||||||||||
| Acquisition-related and other costs (A) | 86 | 86 | 86 | 258 | 331 | |||||||||||||||||
| Stock-based compensation expense (B) | 44 | 32 | 28 | 102 | 62 | |||||||||||||||||
| IP-related costs | - | 4 | 21 | 8 | 38 | |||||||||||||||||
| Non-GAAP gross profit | $ | 4,761 | $ | 4,337 | $ | 3,095 | $ | 12,844 | $ | 7,671 | ||||||||||||
| Non-GAAP gross margin | 67.0 | % | 66.7 | % | 65.5 | % | 66.6 | % | 65.7 | % | ||||||||||||
| GAAP operating expenses | $ | 1,960 | $ | 1,771 | $ | 1,562 | $ | 5,405 | $ | 4,215 | ||||||||||||
| Stock-based compensation expense (B) | (515 | ) | (433 | ) | (355 | ) | (1,351 | ) | (919 | ) | ||||||||||||
| Acquisition-related and other costs (A) | (70 | ) | (72 | ) | (106 | ) | (224 | ) | (338 | ) | ||||||||||||
| Non-GAAP operating expenses | $ | 1,375 | $ | 1,266 | $ | 1,101 | $ | 3,830 | $ | 2,958 | ||||||||||||
| GAAP income from operations | $ | 2,671 | $ | 2,444 | $ | 1,398 | $ | 7,071 | $ | 3,025 | ||||||||||||
| Total impact of non-GAAP adjustments to income from operations | 715 | 627 | 595 | 1,943 | 1,689 | |||||||||||||||||
| Non-GAAP income from operations | $ | 3,386 | $ | 3,071 | $ | 1,993 | $ | 9,014 | $ | 4,714 | ||||||||||||
| GAAP other income (expense), net | $ | (33 | ) | $ | (50 | ) | $ | (50 | ) | $ | 5 | $ | (86 | ) | ||||||||
| (Gains) losses from non-affiliated investments | (20 | ) | - | 4 | (153 | ) | 9 | |||||||||||||||
| Interest expense related to amortization of debt discount | 1 | 1 | 1 | 3 | 1 | |||||||||||||||||
| Non-GAAP other income (expense), net | $ | (52 | ) | $ | (49 | ) | $ | (45 | ) | $ | (145 | ) | $ | (76 | ) | |||||||
| GAAP net income | $ | 2,464 | $ | 2,374 | $ | 1,336 | $ | 6,749 | $ | 2,875 | ||||||||||||
| Total pre-tax impact of non-GAAP adjustments | 696 | 628 | 600 | 1,793 | 1,699 | |||||||||||||||||
| Income tax impact of non-GAAP adjustments (C) | (187 | ) | (127 | ) | (102 | ) | (381 | ) | (255 | ) | ||||||||||||
| Domestication tax benefit | - | (252 | ) | - | (252 | ) | - | |||||||||||||||
| Non-GAAP net income | $ | 2,973 | $ | 2,623 | $ | 1,834 | $ | 7,909 | $ | 4,319 | ||||||||||||
| Diluted net income per share (D) | ||||||||||||||||||||||
| GAAP | $ | 0.97 | $ | 0.94 | $ | 0.53 | $ | 2.67 | $ | 1.15 | ||||||||||||
| Non-GAAP | $ | 1.17 | $ | 1.04 | $ | 0.73 | $ | 3.12 | $ | 1.72 | ||||||||||||
| Weighted average shares used in diluted net income per share computation (D) | 2,538 | 2,532 | 2,520 | 2,532 | 2,504 | |||||||||||||||||
| GAAP net cash provided by operating activities | $ | 1,519 | $ | 2,682 | $ | 1,279 | $ | 6,075 | $ | 3,755 | ||||||||||||
| Purchases related to property and equipment and intangible assets | (221 | ) | (183 | ) | (473 | ) | (703 | ) | (845 | ) | ||||||||||||
| Principal payments on property and equipment | (22 | ) | (21 | ) | - | (62 | ) | - | ||||||||||||||
| Free cash flow | $ | 1,276 | $ | 2,478 | $ | 806 | $ | 5,310 | $ | 2,910 | ||||||||||||
| (A) Acquisition-related and other costs primarily include amortization of intangible assets, inventory step-up, transaction costs, and certain compensation charges presented as follows: | ||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||
| October 31, | August 1, | October 25, | October 31, | October 25, | ||||||||||||||||||
| 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||
| Cost of revenue | $ | 86 | $ | 86 | $ | 86 | $ | 258 | $ | 331 | ||||||||||||
| Research and development | $ | 7 | $ | 1 | $ | 2 | $ | 10 | $ | 7 | ||||||||||||
| Sales, general and administrative | $ | 63 | $ | 71 | $ | 104 | $ | 214 | $ | 331 | ||||||||||||
| (B) Stock-based compensation consists of the following: | ||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||
| October 31, | August 1, | October 25, | October 31, | October 25, | ||||||||||||||||||
| 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||
| Cost of revenue | $ | 44 | $ | 32 | $ | 28 | $ | 102 | $ | 62 | ||||||||||||
| Research and development | $ | 363 | $ | 297 | $ | 232 | $ | 935 | $ | 594 | ||||||||||||
| Sales, general and administrative | $ | 152 | $ | 136 | $ | 123 | $ | 416 | $ | 325 | ||||||||||||
| (C) Income tax impact of non-GAAP adjustments, including the recognition of excess tax benefits or deficiencies related to stock-based compensation under GAAP accounting standard (ASU 2016-09). | ||||||||||||||||||||||
| (D) Reflects a four-for-one stock split on July 19, 2021. | ||||||||||||||||||||||
NVIDIA Announces Financial Results for Third Quarter Fiscal 2022
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