Nvidia posts biggest quarterly revenue growth in six years; shares soar

Shares of the company, which also forecast current-quarter revenue above analysts' average estimate, were up 9.8 percent at $74.40 in after-hours trading on Thursday.

Nvidia also increased its quarterly dividend to 14 cents per share from 11.5 cents per share and also authorized an additional $2 billion under its buyback program.

The Santa Clara, California-based company dominates the high-end PC gaming market, where its chips are used to power graphically demanding games such as Electronic Arts Inc's "Titanfall 2" and Activision Blizzard Inc's "Call of Duty" series.

Revenue from the company's graphics processing units business, which contributes 85 percent of its total revenue, rose 52.9 percent to $1.70 billion in the quarter.

Apart from producing chips for the gaming industry, Nvidia has diversified into newer areas, ranging from virtual reality to chips used in self-driving cars.

Revenue from the company's automotive business, which recently signed an agreement to supply chips for Tesla Motors Inc's Autopilot system, soared 60.8 percent to $127 million.

Nvidia forecast revenue to increase to $2.10 billion, plus or minus two percent, in the current quarter. Analysts on average were expecting a rise to $1.69 billion, according to Thomson Reuters I/B/E/S.

Excluding items, Nvidia earned 94 cents per share in the second quarter.

Revenue rose to $2.00 billion from $1.31 billion.

Analysts on average had expected revenue of $1.69 billion.

The company's net income rose to $542 million, or 83 cents per share, in the third quarter ended Oct. 30 from $246 million, or 44 cents per share, a year earlier.

Up to Thursday's close of $67.77, shares had more than doubled this year, handily outperforming the 6 percent gain in the broader S&P 500 index.

(Reporting by Narottam Medhora in Bengaluru; Editing by Anil D'Silva and Sriraj Kalluvila)