NVIDIA CORP 10-Q

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED) NVIDIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share data) (Unaudited) Three Months Ended Nine Months Ended October 31, October 25, October 31, October 25, 2021 2020 2021 2020 Revenue $ 7,103 $ 4,726 $ 19,271 $ 11,672 Cost of revenue 2,472 1,766 6,795 4,432 Gross profit 4,631 2,960 12,476 7,240 Operating expenses Research and development 1,403 1,047 3,802 2,778 Sales, general and administrative 557 515 1,603 1,437 Total operating expenses 1,960 1,562 5,405 4,215 Income from operations 2,671 1,398 7,071 3,025 Interest income 7 7 20 50 Interest expense ( 62 ) ( 53 ) ( 175 ) ( 131 ) Other, net 22 ( 4 ) 160 ( 5 ) Other income (expense), net ( 33 ) ( 50 ) 5 ( 86 ) Income before income tax 2,638 1,348 7,076 2,939 Income tax expense 174 12 327 64 Net income $ 2,464 $ 1,336 $ 6,749 $ 2,875 Net income per share: Basic $ 0.99 $ 0.54 $ 2.71 $ 1.17 Diluted $ 0.97 $ 0.53 $ 2.67 $ 1.15 Weighted average shares used in per share computation: Basic 2,499 2,472 2,493 2,464 Diluted 2,538 2,520 2,532 2,504 See accompanying Notes to Condensed Consolidated Financial Statements. 3 NVIDIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In millions) (Unaudited) Three Months Ended Nine Months Ended October 31, October 25, October 31, October 25, 2021 2020 2021 2020 Net income $ 2,464 $ 1,336 $ 6,749 $ 2,875 Other comprehensive income (loss), net of tax Available-for-sale securities: Net change in unrealized gain (loss) ( 4 ) ( 1 ) ( 5 ) 3 Reclassification adjustments for net realized gain (loss) included in net income — — — ( 2 ) Net change in unrealized gain (loss) ( 4 ) ( 1 ) ( 5 ) 1 Cash flow hedges: Net unrealized gain (loss) 22 5 ( 5 ) 10 Reclassification adjustments for net realized gain (loss) included in net income ( 17 ) 4 — — Net change in unrealized gain (loss) 5 9 ( 5 ) 10 Other comprehensive income (loss), net of tax 1 8 ( 10 ) 11 Total comprehensive income $ 2,465 $ 1,344 $ 6,739 $ 2,886 See accompanying Notes to Condensed Consolidated Financial Statements. 4 NVIDIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In millions) (Unaudited) October 31, January 31, 2021 2021 ASSETS Current assets: Cash and cash equivalents $ 1,288 $ 847 Marketable securities 18,010 10,714 Accounts receivable, net 3,954 2,429 Inventories 2,233 1,826 Prepaid expenses and other current assets 321 239 Total current assets 25,806 16,055 Property and equipment, net 2,509 2,149 Operating lease assets 830 707 Goodwill 4,302 4,193 Intangible assets, net 2,454 2,737 Deferred income tax assets 970 806 Other assets 3,761 2,144 Total assets $ 40,632 $ 28,791 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable $ 1,664 $ 1,201 Accrued and other current liabilities 1,948 1,725 Short-term debt — 999 Total current liabilities 3,612 3,925 Long-term debt 10,944 5,964 Long-term operating lease liabilities 743 634 Other long-term liabilities 1,535 1,375 Total liabilities 16,834 11,898 Commitments and contingencies - see Note 13 Shareholders’ equity: Preferred stock — — Common stock 3 3 Additional paid-in capital 10,465 8,719 Treasury stock, at cost ( 12,038 ) ( 10,756 ) Accumulated other comprehensive income 9 19 Retained earnings 25,359 18,908 Total shareholders' equity 23,798 16,893 Total liabilities and shareholders' equity $ 40,632 $ 28,791 See accompanying Notes to Condensed Consolidated Financial Statements. 5 NVIDIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 AND OCTOBER 25, 2020 (Unaudited) Common Stock Outstanding Additional Paid-in Capital Treasury Stock Accumulated Other Comprehensive Income Retained Earnings Total Shareholders' Equity (In millions, except per share data) Shares Amount Balances, August 1, 2021 2,496 $ 3 $ 9,745 $ ( 11,604 ) $ 8 $ 22,995 $ 21,147 Net income — — — — — 2,464 2,464 Other comprehensive income — — — — 1 — 1 Issuance of common stock from stock plans 8 — 150 — — — 150 Tax withholding related to vesting of restricted stock units ( 2 ) — — ( 434 ) — — ( 434 ) Cash dividends declared and paid ($ 0.04 per common share) — — — — — ( 100 ) ( 100 ) Fair value of partially vested equity awards assumed in connection with acquisitions — — 18 — — — 18 Stock-based compensation — — 552 — — — 552 Balances, October 31, 2021 2,502 $ 3 $ 10,465 $ ( 12,038 ) $ 9 $ 25,359 $ 23,798 Balances, July 26, 2020 2,467 $ 3 $ 7,826 $ ( 10,232 ) $ 4 $ 16,313 $ 13,914 Net income — — — — — 1,336 1,336 Other comprehensive income — — — — 8 — 8 Issuance of common stock from stock plans 10 — 96 — — — 96 Tax withholding related to vesting of restricted stock units ( 2 ) — — ( 298 ) — — ( 298 ) Cash dividends declared and paid ($ 0.04 per common share) — — — — — ( 99 ) ( 99 ) Stock-based compensation — — 377 — — — 377 Balances, October 25, 2020 2,475 $ 3 $ 8,299 $ ( 10,530 ) $ 12 $ 17,550 $ 15,334 See accompanying Notes to Condensed Consolidated Financial Statements. 6 NVIDIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY FOR THE NINE MONTHS ENDED OCTOBER 31, 2021 AND OCTOBER 25, 2020 (Unaudited) Common Stock Outstanding Additional Paid-in Capital Treasury Stock Accumulated Other Comprehensive Income Retained Earnings Total Shareholders' Equity (In millions, except per share data) Shares Amount Balances, January 31, 2021 2,479 $ 3 $ 8,719 $ ( 10,756 ) $ 19 $ 18,908 $ 16,893 Net income — — — — — 6,749 6,749 Other comprehensive loss — — — — ( 10 ) — ( 10 ) Issuance of common stock from stock plans 30 — 277 — — — 277 Tax withholding related to vesting of restricted stock units ( 7 ) — — ( 1,282 ) — — ( 1,282 ) Cash dividends declared and paid ($ 0.12 per common share) — — — — — ( 298 ) ( 298 ) Fair value of partially vested equity awards assumed in connection with acquisitions — — 18 — — — 18 Stock-based compensation — — 1,451 — — — 1,451 Balances, October 31, 2021 2,502 $ 3 $ 10,465 $ ( 12,038 ) $ 9 $ 25,359 $ 23,798 Balances, January 26, 2020 2,450 $ 3 $ 7,043 $ ( 9,814 ) $ 1 $ 14,971 $ 12,204 Net income — — — — — 2,875 2,875 Other comprehensive income — — — — 11 — 11 Issuance of common stock from stock plans 34 — 190 — — — 190 Tax withholding related to vesting of restricted stock units ( 9 ) — — ( 716 ) — — ( 716 ) Cash dividends declared and paid ($ 0.12 per common share) — — — — — ( 296 ) ( 296 ) Fair value of partially vested equity awards assumed in connection with acquisitions — — 86 — — — 86 Stock-based compensation — — 980 — — — 980 Balances, October 25, 2020 2,475 $ 3 $ 8,299 $ ( 10,530 ) $ 12 $ 17,550 $ 15,334 See accompanying Notes to Condensed Consolidated Financial Statements. 7 NVIDIA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (Unaudited) Nine Months Ended October 31, October 25, 2021 2020 Cash flows from operating activities: Net income $ 6,749 $ 2,875 Adjustments to reconcile net income to net cash provided by operating activities: Stock-based compensation expense 1,453 981 Depreciation and amortization 865 810 Deferred income taxes ( 182 ) ( 117 ) (Gains) losses on investments in non-affiliates, net ( 152 ) 9 Other 25 ( 11 ) Changes in operating assets and liabilities, net of acquisitions: Accounts receivable ( 1,523 ) ( 667 ) Inventories ( 400 ) ( 190 ) Prepaid expenses and other assets ( 1,557 ) ( 409 ) Accounts payable 474 289 Accrued and other current liabilities 70 111 Other long-term liabilities 253 74 Net cash provided by operating activities 6,075 3,755 Cash flows from investing activities: Proceeds from maturities of marketable securities 7,780 5,165 Proceeds from sales of marketable securities 916 502 Purchases of marketable securities ( 16,020 ) ( 12,840 ) Purchases related to property and equipment and intangible assets ( 703 ) ( 845 ) Acquisitions, net of cash acquired ( 203 ) ( 8,524 ) Investments and other, net ( 14 ) ( 4 ) Net cash used in investing activities ( 8,244 ) ( 16,546 ) Cash flows from financing activities: Issuance of debt, net of issuance costs 4,977 4,971 Proceeds related to employee stock plans 277 190 Payments related to tax on restricted stock units ( 1,282 ) ( 716 ) Repayment of debt ( 1,000 ) — Dividends paid ( 298 ) ( 296 ) Principal payments on property and equipment ( 62 ) — Other ( 2 ) ( 3 ) Net cash provided by financing activities 2,610 4,146 Change in cash and cash equivalents 441 ( 8,645 ) Cash and cash equivalents at beginning of period 847 10,896 Cash and cash equivalents at end of period $ 1,288 $ 2,251 See accompanying Notes to Condensed Consolidated Financial Statements. 8 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1 - Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of Securities and Exchange Commission, or SEC, Regulation S-X. The January 31, 2021 consolidated balance sheet was derived from our audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2021, as filed with the SEC, but does not include all disclosures required by U.S. GAAP. In the opinion of management, all adjustments, consisting only of normal recurring adjustments considered necessary for a fair statement of results of operations and financial position, have been included. The results for the interim periods presented are not necessarily indicative of the results expected for any future period. The following information should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2021. On May 21, 2021, our Board of Directors declared a four -for-one split of our common stock in the form of a stock dividend, or the Stock Split, which was conditioned upon obtaining stockholder approval to increase the number of our authorized shares of common stock from 2 billion to 4 billion. On June 3, 2021, at the 2021 Annual Meeting of Stockholders, our stockholders approved the amendment to our Amended and Restated Certificate of Incorporation to increase the number of authorized shares of common stock to 4 billion. As a result, each stockholder of record at the close of business on June 21, 2021 received a dividend of three additional shares of common stock for every share held on the record date, distributed after the close of trading on July 19, 2021. All share, equity award, and per share amounts and related shareholders' equity balances presented herein have been retroactively adjusted to reflect the Stock Split. Significant Accounting Policies There have been no material changes to our significant accounting policies disclosed in Note 1 - Organization and Summary of Significant Accounting Policies, of the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2021. Fiscal Year We operate on a 52- or 53-week year, ending on the last Sunday in January. Fiscal year 2022 is a 52-week year and fiscal year 2021 was a 53-week year. The third quarters of fiscal years 2022 and 2021 were both 13-week quarters. Reclassifications Certain prior fiscal year balances have been reclassified to conform to the current fiscal year presentation. Principles of Consolidation Our condensed consolidated financial statements include the accounts of NVIDIA Corporation and our wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from our estimates. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, cash equivalents and marketable securities, accounts receivable, inventories, income taxes, goodwill, stock-based compensation, litigation, investigation and settlement costs, restructuring and other charges, and other contingencies. The inputs into our judgments and estimates consider the economic implications of COVID-19. These estimates are based on historical facts and various other assumptions that we believe are reasonable. 9 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Adoption of New and Recently Issued Accounting Pronouncement Recently Adopted Accounting Pronouncement In October 2021, the Financial Accounting Standards Board issued a new accounting standard to require that an acquirer recognize and measure contract assets and liabilities acquired in a business combination in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers . We early adopted this accounting standard in the third quarter of fiscal year 2022 and the impact was immaterial. Note 2 - Business Combination Pending Acquisition of Arm Limited On September 13, 2020, we entered into a Share Purchase Agreement, or the Purchase Agreement, with Arm Limited, or Arm, and SoftBank Group Capital Limited and SVF Holdco (UK) Limited, or together, SoftBank, to acquire, from SoftBank, all allotted and issued ordinary shares of Arm in a transaction valued at $ 40 billion. We paid $ 2 billion in cash at signing, or the Signing Consideration, and will pay upon closing of the acquisition $ 10 billion in cash and issue to SoftBank 177.5 million shares of our common stock, which had an aggregate value of $ 21.5 billion as of the date of the Purchase Agreement, and was valued at $ 56.2 billion as of November 18, 2021. The transaction includes a potential earn out, which is contingent on the achievement of certain financial performance targets by Arm during the fiscal year ending March 31, 2022. If the financial targets are achieved, SoftBank can elect to receive either up to an additional $ 5 billion in cash or up to an additional 41.3 million shares of our common stock, which was valued at $ 13.1 billion as of November 18, 2021. We will issue up to $ 1.5 billion in restricted stock units to Arm employees after closing. The Signing Consideration was allocated between advanced consideration for the acquisition of $ 1.36 billion and the prepayment of intellectual property licenses from Arm of $ 0.17 billion and royalties of $ 0.47 billion, both with a 20-year term. The Signing Consideration was allocated on a fair value basis and any refund of the Signing Consideration will use stated values in the Purchase Agreement. The Purchase Agreement can be terminated by either party if the transaction has not closed by September 2022, subject to certain qualifications. If the transaction does not close due to failure to receive regulatory approval, and all other covenants have been met, we will not be refunded $ 1.25 billion of the advanced consideration for the acquisition we paid at signing. The closing of the acquisition is subject to customary closing conditions, including receipt of specified governmental and regulatory consents and approvals and the expiration of any related mandatory waiting period, and Arm's implementation of the reorganization and distribution of Arm’s IoT Services Group and certain other assets and liabilities. We are seeking regulatory approval in the United States, the United Kingdom, the European Union, China and other jurisdictions. Regulators at the United States Federal Trade Commission, or the FTC, have expressed concerns regarding the transaction, and we are engaged in discussions with the FTC regarding remedies to address those concerns. The transaction has been under the review of China’s antitrust authority, pending the formal case initiation. Regulators in the United Kingdom and the European Union declined to approve the transaction in Phase 1 of their review processes, expressed numerous concerns, began a more in-depth Phase 2 review on the transaction’s impact on competition, and, in the United Kingdom, a Phase 2 review of the impact on the United Kingdom’s national security interests. Although regulators and some Arm licensees have expressed concerns or objected to the transaction, we continue to believe in the merits and benefits of the acquisition to Arm, its licensees, and the industry. Acquisition of Mellanox Technologies, Ltd. On April 27, 2020, we completed the acquisition of all outstanding shares of Mellanox for a total purchase consideration of $ 7.13 billion. Mellanox is a supplier of high-performance interconnect products for computing, storage and communications applications. We acquired Mellanox to optimize data center workloads to scale across the entire computing, networking, and storage stack. 10 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Supplemental Unaudited Pro Forma Information The following unaudited pro forma financial information summarizes the combined results of operations for NVIDIA and Mellanox as if the companies were combined as of the beginning of fiscal year 2020: Pro Forma Three Months Ended Nine Months Ended October 25, 2020 October 25, 2020 (In millions) Revenue $ 4,726 $ 12,101 Net income $ 1,388 $ 3,267 The unaudited pro forma information includes adjustments related to amortization of acquired intangible assets, adjustments to stock-based compensation expense, fair value of acquired inventory, and transaction costs. The unaudited pro forma information presented above is for informational purposes only and is not necessarily indicative of our consolidated results of operations of the combined business had the acquisition occurred at the beginning of fiscal year 2020 or of the results of our future operations of the combined businesses. The pro forma results exclude the inventory step-up expense of $ 161 million for the first nine months of fiscal year 2021. There were no other material nonrecurring adjustments. Note 3 - Leases Our lease obligations primarily consist of operating leases for our headquarters complex, domestic and international office facilities, and data center space, with lease periods expiring between fiscal years 2022 and 2035. Future minimum lease payments under our non-cancelable operating leases as of October 31, 2021, are as follows: Operating Lease Obligations (In millions) Fiscal Year: 2022 (excluding first nine months of fiscal year 2022) $ 43 2023 169 2024 152 2025 128 2026 118 2027 and thereafter 385 Total 995 Less imputed interest 112 Present value of net future minimum lease payments 883 Less short-term operating lease liabilities 140 Long-term operating lease liabilities $ 743 In addition to our existing operating lease obligations, we have operating leases that are expected to commence between the fourth quarter of fiscal year 2022 and fiscal year 2023 with lease terms of 7 years for $ 132 million. Operating lease expenses were $ 44 million and $ 37 million for the third quarter of fiscal years 2022 and 2021, respectively, and $ 125 million and $ 104 million for the first nine months of fiscal years 2022 and 2021, respectively. 11 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Short-term and variable lease expenses for the third quarter and first nine months of fiscal years 2022 and 2021 were not significant. Other information related to leases was as follows: Nine Months Ended October 31, 2021 October 25, 2020 (In millions) Supplemental cash flows information Operating cash flows used for operating leases $ 114 $ 103 Operating lease assets obtained in exchange for lease obligations $ 230 $ 147 As of October 31, 2021, our operating leases had a weighted average remaining lease term of 7.3 years and a weighted average discount rate of 2.54 %. As of January 31, 2021, our operating leases had a weighted average remaining lease term of 7.6 years and a weighted average discount rate of 2.87 %. Note 4 - Stock-Based Compensation Our stock-based compensation expense is associated with restricted stock units, or RSUs, performance stock units that are based on our corporate financial performance targets, or PSUs, performance stock units that are based on market conditions, or market-based PSUs, and our employee stock purchase plan, or ESPP. Our Condensed Consolidated Statements of Income include stock-based compensation expense, net of amounts allocated to inventory, as follows: Three Months Ended Nine Months Ended October 31, 2021 October 25, 2020 October 31, 2021 October 25, 2020 (In millions) Cost of revenue $ 44 $ 28 $ 102 $ 62 Research and development 363 232 935 594 Sales, general and administrative 152 123 416 325 Total $ 559 $ 383 $ 1,453 $ 981 Equity Award Activity The following is a summary of equity award transactions under our equity incentive plans: RSUs, PSUs, and Market-based PSUs Outstanding Number of Shares Weighted Average Grant-Date Fair Value Per Share (In millions, except per share data) Balances, January 31, 2021 59 $ 66.17 Granted 17 $ 184.63 Vested restricted stock ( 23 ) $ 62.39 Canceled and forfeited ( 1 ) $ 80.50 Balances, October 31, 2021 52 $ 107.42 As of October 31, 2021, there was $ 5.16 billion of aggregate unearned stock-based compensation expense, net of forfeitures. This amount is expected to be recognized over a weighted average period of 2.6 years for RSUs, PSUs, and market-based PSUs, and 1 year for ESPP. 12 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Note 5 – Net Income Per Share The following is a reconciliation of the denominator of the basic and diluted net income per share computations for the periods presented: Three Months Ended Nine Months Ended October 31, October 25, October 31, October 25, 2021 2020 2021 2020 (In millions, except per share data) Numerator: Net income $ 2,464 $ 1,336 $ 6,749 $ 2,875 Denominator: Basic weighted average shares 2,499 2,472 2,493 2,464 Dilutive impact of outstanding equity awards 39 48 39 40 Diluted weighted average shares 2,538 2,520 2,532 2,504 Net income per share: Basic (1) $ 0.99 $ 0.54 $ 2.71 $ 1.17 Diluted (2) $ 0.97 $ 0.53 $ 2.67 $ 1.15 Equity awards excluded from diluted net income per share because their effect would have been anti-dilutive 2 — 21 32 (1) Calculated as net income divided by basic weighted average shares. (2) Calculated as net income divided by diluted weighted average shares. Note 6 – Income Taxes We recognized an income tax expense of $ 174 million and $ 327 million for the third quarter and first nine months of fiscal year 2022, respectively, and an income tax expense of $ 12 million and $ 64 million for the third quarter and first nine months of fiscal year 2021, respectively. The income tax expense as a percentage of income before income tax was 6.6 % and 4.6 % for the third quarter and first nine months of fiscal year 2022, respectively, and 0.9 % and 2.2 % for the third quarter and first nine months of fiscal year 2021, respectively. On June 28, 2021, we simplified our corporate structure by repatriating the economic rights of certain non-U.S. intellectual property to the United States via domestication of a foreign subsidiary, or the Domestication. The Domestication more closely aligns our corporate structure to our operating structure in accordance with the Organization for Economic Cooperation and Development’s Base Erosion and Profit Shifting conclusions and changes to U.S. and European tax laws. The impact of the Domestication, which is regarded as a change in tax status, resulted in a discrete benefit primarily from re-valuing certain deferred tax assets, net of deferred tax liabilities, of $ 252 million in the second quarter of fiscal year 2022. The increase in our effective tax rate for the third quarter and first nine months of fiscal year 2022 as compared to the same periods of fiscal year 2021 was primarily due to an increase in the amount of earnings subject to U.S. tax, and a decreased impact of tax benefits from stock-based compensation and the U.S. federal research tax credit, partially offset, for the first nine months, by the discrete benefit of the Domestication. Our effective tax rate for the first nine months of fiscal year 2021 was lower than the U.S. federal statutory rate of 21% due to income earned in jurisdictions that are subject to taxes lower than the U.S. federal statutory tax rate, the benefit of the U.S. federal research tax credit, and tax benefits related to stock-based compensation. Our effective tax rate for the first nine months of fiscal year 2022 was lower than the U.S. federal statutory rate of 21% due to tax benefits from the foreign-derived intangible income deduction, income earned in jurisdictions that are subject to taxes lower than the U.S. federal statutory tax rate, the discrete benefit of the Domestication, and tax benefits related to stock-based compensation and the U.S. federal research tax credit. 13 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) As of October 31, 2021, we intend to indefinitely reinvest approximately $ 1.7 billion and $ 231 million of cumulative undistributed earnings held by certain subsidiaries in Israel and the United Kingdom, respectively. We have not provided the amount of unrecognized deferred tax liabilities for temporary differences related to these investments as the determination of such amount is not practicable. For the first nine months of fiscal year 2022, there have been no material changes to our tax years that remain subject to examination by major tax jurisdictions. We are currently under examination by the Internal Revenue Service for our fiscal years 2018 and 2019. Additionally, there have been no material changes to our unrecognized tax benefits and any related interest or penalties since the fiscal year ended January 31, 2021. While we believe that we have adequately provided for all uncertain tax positions, or tax positions where we believe it is not more-likely-than-not that the position will be sustained upon review, amounts asserted by tax authorities could be greater or less than our accrued position. Accordingly, our provisions on federal, state and foreign tax related matters to be recorded in the future may change as revised estimates are made or the underlying matters are settled or otherwise resolved with the respective tax authorities. As of October 31, 2021, we do not believe that our estimates, as otherwise provided for, on such tax positions will significantly increase or decrease within the next 12 months. Note 7 - Cash Equivalents and Marketable Securities Our cash equivalents and marketable securities related to debt securities are classified as “available-for-sale” debt securities. The following is a summary of cash equivalents and marketable securities as of October 31, 2021 and January 31, 2021: October 31, 2021 Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Reported as Cash Equivalents Marketable Securities (In millions) Corporate debt securities $ 9,179 $ 2 $ ( 1 ) $ 9,180 $ 135 $ 9,045 Debt securities issued by the United States Treasury 4,887 — ( 2 ) 4,885 195 4,690 Debt securities issued by United States government agencies 2,861 — — 2,861 307 2,554 Certificates of deposit 1,512 — — 1,512 32 1,480 Money market funds 360 — — 360 360 — Foreign government bonds 241 — — 241 — 241 Total $ 19,040 $ 2 $ ( 3 ) $ 19,039 $ 1,029 $ 18,010 January 31, 2021 Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Reported as Cash Equivalents Marketable Securities (In millions) Corporate debt securities $ 4,442 $ 2 $ — $ 4,444 $ 234 $ 4,210 Debt securities issued by United States government agencies 2,975 1 — 2,976 28 2,948 Debt securities issued by the United States Treasury 2,846 — — 2,846 25 2,821 Certificates of deposit 705 — — 705 37 668 Money market funds 313 — — 313 313 — Foreign government bonds 67 — — 67 — 67 Total $ 11,348 $ 3 $ — $ 11,351 $ 637 $ 10,714 Net realized gains and unrealized gains and losses were not significant for all periods presented. The amortized cost and estimated fair value of cash equivalents and marketable securities as of October 31, 2021 and January 31, 2021 are shown below by contractual maturity. October 31, 2021 January 31, 2021 Amortized Cost Estimated Fair Value Amortized Cost Estimated Fair Value (In millions) Less than one year $ 16,243 $ 16,244 $ 10,782 $ 10,783 Due in 1 - 5 years 2,797 2,795 566 568 Total $ 19,040 $ 19,039 $ 11,348 $ 11,351 Note 8 – Fair Value of Financial Assets and Liabilities The fair values of our financial assets and liabilities are determined using quoted market prices of identical assets or quoted market prices of similar assets from active markets. We review fair value hierarchy classification on a quarterly basis. 14 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Fair Value at Pricing Category October 31, 2021 January 31, 2021 (In millions) Assets Cash equivalents and marketable securities: Money market funds Level 1 $ 360 $ 313 Corporate debt securities Level 2 $ 9,180 $ 4,444 Debt securities issued by the United States Treasury Level 2 $ 4,885 $ 2,846 Debt securities issued by United States government agencies Level 2 $ 2,861 $ 2,976 Certificates of deposit Level 2 $ 1,512 $ 705 Foreign government bonds Level 2 $ 241 $ 67 Other assets (Investment in non-affiliated entities): Publicly-held equity security (1) Level 1 $ 136 $ — Privately-held equity securities Level 3 $ 172 $ 144 Liabilities (2) 2.20 % Notes Due 2021 Level 2 $ — $ 1,011 0.309 % Notes Due 2023 Level 2 $ 1,247 $ — 0.584 % Notes Due 2024 Level 2 $ 1,244 $ — 3.20 % Notes Due 2026 Level 2 $ 1,086 $ 1,124 1.55 % Notes Due 2028 Level 2 $ 1,233 $ — 2.85 % Notes Due 2030 Level 2 $ 1,597 $ 1,654 2.00 % Notes Due 2031 Level 2 $ 1,239 $ — 3.50 % Notes Due 2040 Level 2 $ 1,118 $ 1,152 3.50 % Notes Due 2050 Level 2 $ 2,285 $ 2,308 3.70 % Notes Due 2060 Level 2 $ 594 $ 602 (1) Unrealized gains of $ 8 million and $ 126 million from an investment in a publicly-traded equity security were recorded in other income (expense), net, in the third quarter and first nine months of fiscal year 2022, respectively. (2) These liabilities are carried on our Consolidated Balance Sheets at their original issuance value, net of unamortized debt discount and issuance costs. 15 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Note 9 - Amortizable Intangible Assets and Goodwill The components of our amortizable intangible assets are as follows: October 31, 2021 January 31, 2021 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (In millions) Acquisition-related intangible assets (1) $ 3,396 $ ( 1,166 ) $ 2,230 $ 3,280 $ ( 774 ) $ 2,506 Patents and licensed technology 709 ( 485 ) 224 706 ( 475 ) 231 Total intangible assets $ 4,105 $ ( 1,651 ) $ 2,454 $ 3,986 $ ( 1,249 ) $ 2,737 (1) As of October 31, 2021, acquisition-related intangible assets include the fair value of a Mellanox in-process research and development project of $ 630 million, which has not yet commenced amortization. Amortization expense associated with intangible assets was $ 143 million and $ 418 million for the third quarter and first nine months of fiscal year 2022, respectively, and $ 174 million and $ 465 million for the third quarter and first nine months of fiscal year 2021, respectively. Future amortization expense related to the net carrying amount of intangible assets, excluding in-process research and development, as of October 31, 2021 is estimated to be $ 145 million for the remainder of fiscal year 2022, $ 576 million in fiscal year 2023, $ 453 million in fiscal year 2024, $ 400 million in fiscal year 2025, $ 117 million in fiscal year 2026, and $ 133 million in fiscal year 2027 and thereafter. In both the third quarter and first nine months of fiscal year 2022, goodwill increased by $ 109 million and intangible assets increased by $ 119 million from acquisitions. We assigned $ 96 million of the increase in goodwill to our Compute & Networking segment and assigned $ 13 million of the increase to our Graphics segment. Note 10 - Balance Sheet Components Certain balance sheet components are as follows: October 31, January 31, 2021 2021 Inventories: (In millions) Raw materials $ 755 $ 632 Work in-process 538 457 Finished goods 940 737 Total inventories $ 2,233 $ 1,826 16 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) October 31, January 31, 2021 2021 Other assets: (In millions) Prepaid supply agreements $ 1,606 $ — Advanced consideration for acquisition 1,357 1,357 Prepaid royalties 416 440 Investment in non-affiliated entities 308 144 Deposits 22 136 Other 52 67 Total other assets $ 3,761 $ 2,144 October 31, January 31, 2021 2021 Accrued and Other Current Liabilities: (In millions) Customer program accruals $ 857 $ 630 Deferred revenue (1) 298 288 Accrued payroll and related expenses 295 297 Operating leases 140 121 Licenses and royalties 108 128 Product warranty and return provisions 45 39 Coupon interest on debt obligations 37 74 Taxes payable 36 61 Professional service fees 30 26 Other 102 61 Total accrued and other current liabilities $ 1,948 $ 1,725 (1) Deferred revenue primarily includes customer advances and deferrals related to license and development arrangements and post-contract customer support, or PCS. October 31, January 31, 2021 2021 Other Long-Term Liabilities: (In millions) Income tax payable (1) $ 1,051 $ 836 Deferred income tax 225 241 Deferred revenue (2) 191 163 Employee benefits 38 33 Licenses payable 21 56 Other 9 46 Total other long-term liabilities $ 1,535 $ 1,375 (1) As of October 31, 2021, income tax payable represents the long-term portion of the one-time transition tax payable of $ 251 million, unrecognized tax benefits of $ 578 million, related interest and penalties of $ 60 million, and other foreign long-term tax payable of $ 162 million. (2) Deferred revenue primarily includes deferrals related to PCS. 17 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Deferred Revenue The following table shows the changes in deferred revenue during the first nine months of fiscal years 2022 and 2021: October 31, October 25, 2021 2020 (In millions) Balance at beginning of period $ 451 $ 201 Deferred revenue added during the period 621 361 Addition due to business combinations — 75 Revenue recognized during the period ( 583 ) ( 255 ) Balance at end of period $ 489 $ 382 Revenue related to remaining performance obligations represents the contracted license, development arrangements and PCS that has not been recognized. This includes deferred revenue currently recorded and amounts that will be invoiced in future periods. As of October 31, 2021, $ 620 million of revenue related to performance obligations had not been recognized, of which we expect to recognize approximately 49 % over the next 12 months and the remainder thereafter. This excludes revenue related to performance obligations for contracts with a length of one year or less. Note 11 - Derivative Financial Instruments We enter into foreign currency forward contracts to mitigate the impact of foreign currency exchange rate movements on our operating expenses. These contracts are designated as cash flow hedges for hedge accounting treatment. Gains or losses on the contracts are recorded in accumulated other comprehensive income or loss and reclassified to operating expense when the related operating expenses are recognized in earnings or ineffectiveness should occur. The fair value of the contracts was not significant as of October 31, 2021 and January 31, 2021. We also enter into foreign currency forward contracts to mitigate the impact of foreign currency movements on monetary assets and liabilities that are denominated in currencies other than the U.S. dollar. These forward contracts were not designated for hedge accounting treatment. Therefore, the change in fair value of these contracts is recorded in other income or expense and offsets the change in fair value of the hedged foreign currency denominated monetary assets and liabilities, which is also recorded in other income or expense. The table below presents the notional value of our foreign currency forward contracts outstanding as of October 31, 2021 and January 31, 2021: October 31, 2021 January 31, 2021 (In millions) Designated as cash flow hedges $ 949 $ 840 Not designated for hedge accounting $ 430 $ 441 As of October 31, 2021, all designated foreign currency forward contracts mature within 18 months. The expected realized gains and losses deferred into accumulated other comprehensive income or loss related to foreign currency forward contracts within the next 12 months was not significant. During the first nine months of fiscal years 2022 and 2021, the impact of derivative financial instruments designated for hedge accounting treatment on other comprehensive income or loss was not significant. Note 12 - Debt Long-Term Debt In June 2021, we issued $ 1.25 billion of the 0.309 % Notes Due 2023, $ 1.25 billion of the 0.584 % Notes Due 2024, $ 1.25 billion of the 1.55 % Notes Due 2028, and $ 1.25 billion of the 2.00 % Notes Due 2031, or collectively, the June 2021 Notes. Interest on the 0.584 % Notes Due 2024 is payable on June 14 and December 14 of each year, beginning on 18 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) December 14, 2021. Interest on all other series of the June 2021 Notes is payable on June 15 and December 15 of each year, beginning on December 15, 2021. We may redeem the June 2021 Notes for cash prior to maturity. However, no make-whole premium will be paid for redemptions of the Notes Due 2023 on or after June 15, 2022, the Notes Due 2024 on or after June 14, 2023, the Notes Due 2028 on or after April 15, 2028, or the Notes Due 2031 on or after March 15, 2031. The net proceeds from the June 2021 Notes were $ 4.98 billion, after deducting debt discount and issuance costs. In March 2020, we issued $ 1.50 billion of the 2.85 % Notes Due 2030, $ 1.00 billion of the 3.50 % Notes Due 2040, $ 2.00 billion of the 3.50 % Notes Due 2050, and $ 500 million of the 3.70 % Notes Due 2060, or collectively, the March 2020 Notes. Interest on the March 2020 Notes is payable on April 1 and October 1 of each year. On August 16, 2021, we repaid the $ 1.00 billion of 2.20 % Notes Due 2021. Interest on the $ 1.00 billion of the 3.20 % Notes Due 2026, or September 2016 Notes, is payable on March 16 and September 16 of each year. The September 2016 Notes, the March 2020 Notes, and the June 2021 Notes, or collectively, the Notes, are our unsecured senior obligations. All existing and future liabilities of our subsidiaries will be effectively senior to the Notes. The carrying value of the Notes and the associated interest rates were as follows: Expected Remaining Term (years) Effective Interest Rate October 31, 2021 January 31, 2021 (In millions) 2.20 % Notes Due 2021 — 2.38 % $ — $ 1,000 0.309 % Notes Due 2023 1.6 0.41 % 1,250 — 0.584 % Notes Due 2024 2.6 0.66 % 1,250 — 3.20 % Notes Due 2026 4.9 3.31 % 1,000 1,000 1.55 % Notes Due 2028 6.6 1.64 % 1,250 — 2.85 % Notes Due 2030 8.4 2.93 % 1,500 1,500 2.00 % Notes Due 2031 9.6 2.09 % 1,250 — 3.50 % Notes Due 2040 18.4 3.54 % 1,000 1,000 3.50 % Notes Due 2050 28.4 3.54 % 2,000 2,000 3.70 % Notes Due 2060 38.4 3.73 % 500 500 Unamortized debt discount and issuance costs ( 56 ) ( 37 ) Net carrying amount 10,944 6,963 Less short-term portion — ( 999 ) Total long-term portion $ 10,944 $ 5,964 As of October 31, 2021, we were in compliance with the required covenants under the Notes. Commercial Paper We have a $ 575 million commercial paper program to support general corporate purposes. As of October 31, 2021, we had no t issued any commercial paper. Note 13 - Commitments and Contingencies Purchase Obligations Our purchase obligations primarily include our commitments to purchase components used to manufacture our products, including long-term supply agreements, certain software and technology licenses, other goods and services and long-lived assets. 19 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) We recently entered into several long-term supply agreements, under which we have made advance payments and have $ 1.79 billion remaining unpaid. As of October 31, 2021, we had outstanding inventory purchase and long-term supply obligations totaling $ 6.90 billion, inclusive of the $ 1.79 billion, and other purchase obligations totaling $ 935 million. Total future unconditional purchase commitments as of October 31, 2021, are as follows: Commitments (In millions) Fiscal Year: 2022 (excluding first nine months of fiscal year 2022) $ 2,944 2023 4,637 2024 172 2025 52 2026 28 Total $ 7,833 Accrual for Product Warranty Liabilities The estimated amount of product warranty liabilities was $ 32 million and $ 22 million as of October 31, 2021 and January 31, 2021, respectively, and the activities were not significant. In connection with certain agreements that we have entered in the past, we have provided indemnities for matters such as tax, product, and employee liabilities. We have included intellectual property indemnification provisions in our technology related agreements with third parties. Maximum potential future payments cannot be estimated because many of these agreements do not have a maximum stated liability. We have not recorded any liability in our Condensed Consolidated Financial Statements for such indemnifications. Litigation Securities Class Action and Derivative Lawsuits The plaintiffs in the putative securities class action lawsuit, captioned 4:18-cv-07669-HSG, initially filed on December 21, 2018 in the United States District Court for the Northern District of California, and titled In Re NVIDIA Corporation Securities Litigation, filed an amended complaint on May 13, 2020. The amended complaint asserted that NVIDIA and certain NVIDIA executives violated Section 10(b) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and SEC Rule 10b-5, by making materially false or misleading statements related to channel inventory and the impact of cryptocurrency mining on GPU demand between May 10, 2017 and November 14, 2018. Plaintiffs also alleged that the NVIDIA executives who they named as defendants violated Section 20(a) of the Exchange Act. Plaintiffs sought class certification, an award of unspecified compensatory damages, an award of reasonable costs and expenses, including attorneys’ fees and expert fees, and further relief as the Court may deem just and proper. On March 2, 2021, the district court granted NVIDIA’s motion to dismiss the complaint without leave to amend, entered judgment in favor of NVIDIA and closed the case. On August 11, 2021, plaintiffs filed an appeal from judgment in the United States Court of Appeals for the Ninth Circuit, case number 21-15604. The putative derivative lawsuit pending in the United States District Court for the Northern District of California, captioned 4:19-cv-00341-HSG, initially filed January 18, 2019 and titled In re NVIDIA Corporation Consolidated Derivative Litigation, remains stayed pending resolution of the plaintiffs’ appeal in the In Re NVIDIA Corporation Securities Litigation action. The lawsuit asserts claims for breach of fiduciary duty, unjust enrichment, waste of corporate assets, and violations of Sections 14(a), 10(b), and 20(a) of the Exchange Act based on the dissemination of allegedly false and misleading statements related to channel inventory and the impact of cryptocurrency mining on GPU demand. The plaintiffs are seeking unspecified damages and other relief, including reforms and improvements to NVIDIA’s corporate governance and internal procedures. The putative derivative actions initially filed September 24, 2019 and pending in the United States District Court for the District of Delaware, Lipchitz v. Huang, et al. (Case No. 1:19-cv-01795-UNA) and Nelson v. Huang, et. al. (Case No. 1:19- 20 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) cv-01798- UNA), remain stayed pending resolution of the plaintiffs’ appeal in the In Re NVIDIA Corporation Securities Litigation action. The lawsuits assert claims for breach of fiduciary duty, unjust enrichment, insider trading, misappropriation of information, corporate waste and violations of Sections 14(a), 10(b), and 20(a) of the Exchange Act based on the dissemination of allegedly false, and misleading statements related to channel inventory and the impact of cryptocurrency mining on GPU demand. The plaintiffs seek unspecified damages and other relief, including disgorgement of profits from the sale of NVIDIA stock and unspecified corporate governance measures. Accounting for Loss Contingencies As of October 31, 2021, we have not recorded any accrual for contingent liabilities associated with the legal proceedings described above based on our belief that liabilities, while possible, are not probable. Further, except as specifically described above, any possible loss or range of loss in these matters cannot be reasonably estimated at this time. We are engaged in legal actions not described above arising in the ordinary course of business and, while there can be no assurance of favorable outcomes, we believe that the ultimate outcome of these actions will not have a material adverse effect on our operating results, liquidity or financial position. Note 14 - Shareholders’ Equity Capital Return Program Beginning August 2004, our Board of Directors authorized us to repurchase our stock. Through October 31, 2021, we have repurchased an aggregate of 1.04 billion shares under our share repurchase program for a total cost of $ 7.08 billion. All shares delivered from these repurchases have been placed into treasury stock. As of October 31, 2021, we were authorized, subject to certain specifications, to repurchase additional shares of our common stock up to $ 7.24 billion through December 2022. During the third quarter and first nine months of fiscal year 2022, we paid $ 100 million and $ 298 million in cash dividends to our shareholders, respectively. During the third quarter and first nine months of fiscal year 2021, we paid $ 99 million and $ 296 million in cash dividends to our shareholders, respectively. Note 15 - Segment Information Our Chief Executive Officer, who is considered to be our chief operating decision maker, or CODM, reviews financial information presented on an operating segment basis for purposes of making decisions and assessing financial performance. Our two operating segments are "Graphics" and "Compute & Networking." Our operating segments are equivalent to our reportable segments. Our Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise design; GRID software for cloud-based visual and virtual computing; and automotive platforms for infotainment systems. Our Compute & Networking segment includes Data Center platforms and systems for artificial intelligence, or AI, high performance computing, or HPC, and accelerated computing; networking and interconnect solutions; automotive AI Cockpit, autonomous driving development agreements, and autonomous vehicle solutions; cryptocurrency mining processors, or CMP; and Jetson for robotics and other embedded platforms. Operating results by segment include costs or expenses that are directly attributable to each segment, and costs or expenses that are leveraged across our unified architecture and therefore allocated between our two segments. The “All Other” category includes the expenses that our CODM does not assign to either Graphics or Compute & Networking for purposes of making operating decisions or assessing financial performance. The expenses include stock-based compensation expense, corporate infrastructure and support costs, acquisition-related costs, IP-related costs, and other non-recurring charges and benefits that our CODM deems to be enterprise in nature. Our CODM does not review any information regarding total assets on a reportable segment basis. Depreciation and amortization expense directly attributable to each reportable segment is included in operating results for each segment. However, the CODM does not evaluate depreciation and amortization expense by operating segment and, therefore, it is not separately presented. There is no intersegment revenue. The accounting policies for segment reporting are the 21 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) same as for our consolidated financial statements. The table below presents details of our reportable segments and the “All Other” category. Graphics Compute & Networking All Other Consolidated (In millions) Three Months Ended October 31, 2021 Revenue $ 4,092 $ 3,011 $ — $ 7,103 Operating income (loss) $ 2,160 $ 1,332 $ ( 821 ) $ 2,671 Three Months Ended October 25, 2020 Revenue $ 2,787 $ 1,939 $ — $ 4,726 Operating income (loss) $ 1,345 $ 738 $ ( 685 ) $ 1,398 Nine Months Ended October 31, 2021 Revenue $ 11,450 $ 7,821 $ — $ 19,271 Operating income (loss) $ 6,073 $ 3,227 $ ( 2,229 ) $ 7,071 Nine Months Ended October 25, 2020 Revenue $ 6,778 $ 4,894 $ — $ 11,672 Operating income (loss) $ 3,092 $ 1,880 $ ( 1,947 ) $ 3,025 Three Months Ended Nine Months Ended October 31, 2021 October 25, 2020 October 31, 2021 October 25, 2020 (In millions) Reconciling items included in "All Other" category: Stock-based compensation expense $ ( 559 ) $ ( 383 ) $ ( 1,453 ) $ ( 981 ) Acquisition-related and other costs ( 156 ) ( 192 ) ( 482 ) ( 669 ) Unallocated cost of revenue and operating expenses ( 106 ) ( 89 ) ( 286 ) ( 259 ) IP-related costs — ( 21 ) ( 8 ) ( 38 ) Total $ ( 821 ) $ ( 685 ) $ ( 2,229 ) $ ( 1,947 ) 22 NVIDIA CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Unaudited) Revenue by geographic region is allocated to individual countries based on the location to which the products are initially billed even if our customers’ revenue is attributable to end customers that are located in a different location. The following table summarizes information pertaining to our revenue from customers based on the invoicing address by geographic regions: Three Months Ended Nine Months Ended October 31, October 25, October 31, October 25, 2021 2020 2021 2020 (In millions) Revenue: Taiwan $ 2,187 $ 1,296 $ 5,932 $ 3,062 China (including Hong Kong) 2,017 1,113 5,128 2,727 Other Asia Pacific 1,067 955 3,115 2,260 United States 1,126 890 2,890 2,331 Europe 340 247 1,150 741 Other countries 366 225 1,056 551 Total revenue $ 7,103 $ 4,726 $ 19,271 $ 11,672 The following table summarizes information pertaining to our revenue by each of the specialized markets we serve: Three Months Ended Nine Months Ended October 31, October 25, October 31, October 25, 2021 2020 2021 2020 (In millions) Revenue: Gaming $ 3,221 $ 2,271 $ 9,042 $ 5,264 Data Center 2,936 1,900 7,350 4,793 Professional Visualization 577 236 1,468 746 Automotive 135 125 441 391 OEM and Other 234 194 970 478 Total revenue $ 7,103 $ 4,726 $ 19,271 $ 11,672 No customer represented 10% or more of total revenue for the third quarter and first nine months of fiscal years 2022 or 2021. One customer represented 14 % and 16 % of our accounts receivable balance as of October 31, 2021 and January 31, 2021, respectively. 23