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Nvidia grew sales of the chips at the heart of the artificial intelligence boom faster than Wall Street anticipated in its latest quarter, reassuring investors that Big Tech’s AI spending spree is going strong.
The world’s most valuable company said revenue was $57bn in the three months to the end of October, up 62 per cent year-on-year, and beating consensus estimates of $55bn compiled by Visible Alpha.
Nvidia’s revenue forecast for the current quarter was $65bn, about $3bn more than Wall Street expected. Its stock climbed as much as 6 per cent in after-hours trading.
The confident outlook from the $4.5tn chip company at the centre of a global AI boom comes as the stock market momentum behind the technology has sputtered.
Tech stocks have tumbled in recent weeks as investors fret over the lofty valuations of big US tech groups and their huge capital expenditure on chips and data centres.
“There has been a lot of talk about an AI bubble. From our vantage point we see something very different,” said Jensen Huang, Nvidia’s chief executive.
He added that sales were “off the charts” for its latest chips, which are essential to training and running AI systems like those that power OpenAI’s ChatGPT.
Bank of America analysts said Nvidia had faced “the tough task of meeting high earnings expectations and high scepticism around AI capex”.
The chip giant’s shares had fallen 11 per cent from their peak in early November prior to the earnings report.
Daniel Newman, chief executive of research company The Futurum Group, said the earnings showed the momentum around AI was “still intact”.
“While it’s hard to believe the demand is this stable and significant, at some point the doubters are going to have to start to believe,” he added.
Nvidia’s earnings boosted other tech stocks, with rival AMD rising nearly 4 per cent after-hours.
However, in a regulatory filing, Nvidia warned for the first time that its customers’ ability to “secure capital and energy” for AI data centres was a potential brake on growth.
The chips group said customers with less financial firepower “may face difficulties securing financing for large-scale infrastructure projects”, potentially causing delays and hitting AI adoption.
Net income for the quarter was $31.9bn against estimates of $30bn, with a gross margin of 73.4 per cent. Data centre revenue, which refers to Nvidia’s AI chip sales, was $51.2bn, above estimates of $49bn.
Nvidia said it saw “continued strong demand” for last year’s Blackwell chips even as it started to ship its successor, Blackwell Ultra, in significant volumes.
It expects its gross margin to hit 75 per cent in the current quarter as planned, after eroding slightly during 2025 due to the cost of launching its latest Blackwell technology.
Nvidia briefly surpassed $5tn in market capitalisation in October, helped by a bullish revenue projection from Huang, as well as hopes of a diplomatic breakthrough between Washington and Beijing that would allow it to resume AI chip sales in China — which has not materialised.
Wednesday’s solid results came despite Nvidia in effect being shut out of China’s data centre market, where tech companies are under government pressure to use domestic alternatives.
Sales of Nvidia’s H20 chip, which had been customised for the Chinese market to meet US export controls, were “insignificant” in the past quarter, the company said. It did not include any potential China revenue in its outlook.
Like other Big Tech groups, Nvidia is rapidly expanding its own investment in cloud computing infrastructure.
It said its spending on “multiyear cloud service agreements”, which includes its own research and development, more than doubled to $26bn compared with the previous quarter.
Nvidia struck a $6bn deal to source computing power from AI cloud provider CoreWeave last month, for example. Some analysts have pointed to the “circular” nature of agreements between Nvidia and its largest customers in Silicon Valley, including a planned investment of up to $100bn in OpenAI.
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