A dreaded cyclical downturn for the chip industry is here. Specifically, consumers are slamming the brakes on the purchase of new PCs and smartphones, which has hit Nvidia's (NASDAQ: NVDA) empire built on the GPU (graphics processing unit) especially hard. During the last quarter, sales from video gaming and other graphics applications were halved compared to a year prior.  

Enterprise computing is a different story entirely, though. At the moment, the sale of actual GPUs is still fueling plenty of growth at Nvidia, and a budding software business is beginning to emerge as well. Will 2023 be the year Nvidia makes the jump from semiconductor business to software? 

To be clear, Nvidia does not separate out revenue it earns from software services from revenue from selling actual semiconductor hardware. We can assume, though, that the bulk of sales still comes from the sale of GPUs and GPU-powered computing systems for data centers. After all, Nvidia has a long history of bundling free-to-use software with a chip purchase to make it easier for video game enthusiasts and developers to get their new GPUs running as quickly as possible. 

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Source Fool.com