EVP and Chief Financial Officer at NVIDIA
Thanks, Simona. We delivered a strong quarter, driven by record revenue in both Data Center and Gaming with strong fundamentals and execution against a challenging macro backdrop. Total revenue of $8.3 billion was a record, up 8% sequentially and up 46% year-on-year. Data Center has become our largest market platform and we see continued strong momentum going forward.
Starting with Gaming. Revenue of $3.6 billion, rose 6% sequentially and 31% year-on-year, powered by the GeForce RTX 30 Series product cycle. Since launching in the fall of 2020, the RTX 30 Series has been our best gaming product cycle ever. The gaming industry has grown tremendously with 100 million new PC gamers added in the past two years according to Newzoo and NVIDIA RTX has set new standard for the industry with demand from both first time GPU buyers as well as those upgrading their PCs to experience the 250 plus RTX optimized games and apps, double from last year.
We estimate that almost a third of the GeForce gaming GPU installed base is now on RTX. RTX has brought tremendous energy into the gaming world and has helped drive a sustained expansion in our higher-end platforms and installed base with significant runway still ahead. Overall end demand remained solid through -- though mixed by region and demand in Americas remained strong. However, we started seeing softness in parts of Europe related to the war in the Ukraine and parts of China due to the COVID lockdowns.
As we expect some ongoing impact as we prepare for a new architectural transition later in the year, we are projecting gaming revenue to decline sequentially in Q2. Channel inventory has nearly normalized and we expect it to remain around these levels in Q2. The extent in which cryptocurrency mining contributed to gaming demand is difficult for us to quantify with any reasonable degree of precision. The reduced pace of increase in Ethereum network hash rate likely reflects lower mining activity on GPUs. We expect a diminishing contribution going forward.
Laptop gaming revenue posted strong sequential and year-on-year growth, driven by the ramp of the NVIDIA RTX 30 Series lineup. With this year's spring refresh and ahead of the upcoming back-to-school season, there are now over 180 laptop models featuring RTX 30 Series GPUs and our energy efficient thin and light Max-Q technologies, up from 140 at this time last year. Driving this growth are not just gamers, but also the fast growing category of content creators from whom we offer dedicated NVIDIA Studio drivers.
We've also developed applications and tools to empower artists from Omniverse for advanced 3D and collaboration to broadcast for live streaming to canvas for painting landscapes with AI. The creator economy is estimated at $100 billion and powered by 80 million individual creators and broadcasters. We continued to build out our GeForce NOW cloud gaming service. Gamers can now access RTX 3080-class streaming, our new top-tier offering with subscription plan of $19.99 a month. We added over 100 games to the GeForce NOW library, bringing the total to over 1,300 games and last week, we launched Fortnite on GeForce NOW with touch controls for mobile devices, streaming through the Safari web browser, on iOS and the GeForce NOW Android app.
Moving to Pro Visualization. Q1 revenue was $622 million, was down sequentially 3% and up 67% from a year ago. Demand remained strong as enterprises continued to build out their employee's remote office infrastructure to support hybrid work. Sequential growth in the mobile workstations GPUs was offset by lower desktop revenue. Strong year-on-year growth was supported by the NVIDIA RTX Ampere architecture product cycle. Top use cases include digital content creation at customers such as Sony Pictures Animation and medical imaging at customers such as Medtronic.
In just its second quarter of general availability, our Omniverse enterprise software is being adopted by some of the world's largest companies. Amazon is using Omniverse to create digital twins to better optimize warehouse design and flow and to train more intelligent robots, Kroger is using Omniverse to optimize store efficiency with digital twin store simulation and PepsiCo is using Omniverse digital twins to improve the efficiency and environmental sustainability of its supply chain. Omniverse is also expanding our GPU sales pipeline, driving higher end and multiple GPU configurations. The Omniverse ecosystem continues to rapidly expand with third-party developers in the robotics, industrial automation, 3D design and rendering ecosystems, developing connections to Omniverse.
Moving to Automotive. Q1 revenue of $138 million, increased 10% sequentially and declined 10% from the year ago quarter. Our DRIVE Orin SoC is now in production and kicks off a major product cycle with auto customers ramping in Q2 and beyond. Orin has great traction in the marketplace with over 35 customer wins from automakers, truck makers and robo-taxi companies. In Q1, BYD, China's largest EV maker and Lucid, an award-winning EV pioneer were the latest to announce that they are building their next-generation fleet on DRIVE Orin. Our automotive design win pipeline now exceeds $11 billion over the next six years, up from $8 billion just a year ago.
Moving to Data Center. Record revenue of $3.8 billion, grew 15% sequentially and accelerated to 83% growth year-on-year. Revenue from hyperscale and cloud computing customers more than doubled year-on-year, driven by strong demand for both external and internal workloads. Customers remain supply constraint in their infrastructure needs and continue to add capacity as they tried to keep pace with demand. Revenue from vertical industries grew a strong double-digit percentage from last year. Top verticals driving growth this quarter include consumer Internet companies, financial services and telecom. Overall Data Center growth was driven primarily by strong adoption of our A100 GPU for both training and inference with large volume deployments by hyperscale customers and broadening adoption across the vertical industries. Top workloads include recommender systems, Conversational AI, large language models and cloud graphics.
Networking revenue accelerated on strong broad-based demand for our next-generation 2550 and 100 gig Ethernet adapters. Customers are choosing NVIDIA's networking products for their leading performance and robust software functionality. In addition, Networking revenue is benefiting from growing demand for DGX SuperPOD and cross-selling opportunities. Customers are increasingly combining our compute and networking products to build what are essentially modern AI factories with data as the raw material input and intelligence as the output. Our networking products are still supply constrained though we expect continued improvement throughout the rest of the year.
One of the biggest workloads driving adoption of NVIDIA AI is Natural Language Processing, which has been revolutionized by transformer-based models. Recent industry breakthroughs traced to transformers include large language models like GPT-3, NVIDIA Megatron [Phonetic] BERT for drug discovery and DeepMind AlphaFold for protein structure prediction. Transformers allow self-supervised learning without the need for human labeled data. They enable unprecedented levels of accuracy for tasks such as text generation, translation, summarization and answering questions.
To do that, transformers use enormous training data sets and very large neural networks well into the hundreds of billions of parameters. To run these giant models without sacrificing low inference times, customers like Microsoft are increasingly deploying NVIDIA AI, including our NVIDIA Ampere architecture-based GPUs and full software stack. In addition, we are seeing a rising wave of customer innovation using large language models that is driven by increased demand for NVIDIA AI and GPU instances in the cloud.
At GTC, we announced our next-generation Data Center GPU, the H100 based on the new Hopper Architecture. Pact with 80 billion transistors, H100 is the world's largest most powerful accelerator offering an order of magnitude leap in performance over the A100. We believe H100 is hitting the market at the perfect time. H100 is ideal for advancing large language models and deep recommender systems, the two largest scale AI workloads today. We are working with leading server makers and hyperscale customers to qualify and ramp H100 as well as the new DJX H100 AI computing system will ramp in volume late in the calendar year.
Building on the H100 product cycle goal, we are on track to launch our first ever Data Center CPU, Grace in the first half of 2023. Grace is the ideal CPU for AI factories. This week at COMPUTEX, we announced that dozens of server models based on Grace will be brought to market by the first wave of system builders, including ASUS, Foxconn, GIGABYTE, QCT, Supermicro and Wiwynn. These servers will be powered by the NVIDIA Grace CPU Superchip, which features two CPUs and the Grace Hopper Superchip, which pairs an NVIDIA Hopper GPU with an NVIDIA Grace CPU in an integrated model.
We've introduced new reference designs based on Grace for the massive new workflows of next-generation Data Centers. CGX for cloud graphics and gaming, OVX for digital twins or Omniverse and HDX for HPC and AI. These server designs are all optimized for NVIDIA's rich accelerated computing software stacks and can be qualified as part of our NVIDIA certified systems lineup. The enabler for the Grace Hopper and Grace Superchips is our ultra-energy efficient, low latency, high speed memory coherent interconnect called NVLink, which scales from die to die, chip to chip and system to system. With NVLink, we can configure Grace and Hopper to address a broad range of workloads. Future NVIDIA chips, the CPUs, GPUs, DPUs, NICs and SoCs, will integrate NVLink just like Grace and Hopper based on our world-class SerDes technology. We are making NVLink open to customers and partners to implement custom chips that connect to NVIDIA's platforms.
In Networking, we're kicking off a major product cycle with the introduction of Spectrum-4, the world's first 400-gigabit per second end-to-end Ethernet networking platform, including the Spectrum-4 switch, ConnectX-7 SmartNIC, BlueField-3 DPU and the DOCA software. Built for AI, NVIDIA Spectrum-4 arrives as data centers are growing exponentially and demanding extreme performance, advanced security and powerful features to enable high performance advanced virtualization and simulation at scale. Across our businesses, we are launching multiple new GPU, CPU, DPU and SoC products over the coming quarters with a ramp in supply to support the customer demand.
Moving to the rest of the P&L. GAAP gross margin for the first quarter was 65.5% and non-GAAP gross margin was up 67.1%, up 90 basis points from a year ago and up 10 basis points sequentially. We've been able to offset rising costs and supply chain pressures. We expect to maintain gross margins at current levels in Q2. Going forward, as new products ramp and software becomes a larger percent of revenue, we have opportunities to increase gross margins longer term. GAAP operating margin was 22.5%, impacted by a $1.35 billion acquisition termination charge related to the Arm transaction. Non-GAAP operating margin was 47.7%. We are closely managing our operating expenses to balance the current macro environment with our growth opportunities and we've been very successful in hiring so far this year and are now slowing to integrate these new employees. This also enables us to focus our budget and taking care of our existing employees as inflation persist.
We are still on track to grow our non-GAAP operating expenses in the high-20s range this year. We expect sequential increases to level off after Q2 as the first half of the year includes a significant amount of expenses related to the bring up of multiple new products, which should not reoccur in the second half. During Q1, we repurchased $2 billion of our stock. Our Board of Directors increased and extended our share repurchase program to repurchase an additional common stock up to a total of $15 billion through December 2023.
Let me now turn to the outlook for the second quarter of fiscal 2023. Our outlook assumes an estimated impact of approximately $500 million relating to Russia and China COVID lockdowns. We estimate the impact of lower sell-through in Russia and China to affect our Q2 gaming sell-in by $400 million. Furthermore, we estimate the absence of sales to Russia to have a $100 million impact on Q2 in Data Center. We expect strong sequential growth in Data Center and Automotive to be more than an offset by the sequential decline in Gaming.
Revenue is expected to be $8.1 billion plus or minus 2%. GAAP and non-GAAP gross margins are expected to be 65.1% and 67.1%, respectively plus or minus 50 basis points. GAAP operating expenses are expected to be $2.46 billion. Non-GAAP operating expenses are expected to be $1.75 billion. GAAP and non-GAAP, other income and expenses are expected to be an expense of approximately $40 million, excluding gains and losses on non-affiliated investments. GAAP and non-GAAP tax rates are expected to be 12.5%, plus or minus 1%, excluding discrete items. And capital expenditures are expected to be approximately $400 million to $450 million.
Further financial details are included in the CFO commentary and other information available on our IR website. In closing, let me highlight the upcoming events for the financial community. We will be attending the BofA Securities Technology Conference in person on June 7, where Jensen will participate in a keynote fireside chat. Our earnings call to discuss the results of our second quarter of fiscal 2023 is scheduled for Wednesday, August 24.
We will now open the call for questions. Operator, could you please poll for questions? Thank you.