Nvidia unveiled strong third-quarter earnings that outperformed predictions for profits and sales, while revealing an upbeat forecast for the current quarter. Demand for its potent AI chips remains elevated, further accelerating the company’s rapid growth.
Meanwhile, despite these results being positively received, Nvidia’s stock dropped 2% in after-hours trading. This is after a surge of more than 200% so far this year.
The company reported an earnings per share of 81 cents, surpassing the prediction of 75 cents given by LSEG analysts. Revenue came in at $35.08 billion, outpacing the expected $33.16 billion.
Nvidia predicts current quarter sales to approximate $37.5 billion. This figure surpasses LSEG analysts’ projection of $37.08 billion, but also results in a deceleration of its year-on-year growth to about 70%, compared to the 265% growth observed last year.
The tech giant still managed to record a significant 94% rise in revenues for the quarter ending October 27, though this demonstrates a successive slowdown from its previous three quarters’ growth of 122%, 262%, and 265%, respectively.
In addition, Nvidia’s shares have so far tripled in 2024, boosted substantially by the ongoing artificial intelligence revolution. The principal growth engine underpinning the company’s extraordinary success remains its data center business, which contributes the lion’s share of Nvidia’s revenue.
Its lucrative data center division posted revenue figures of $30.8 billion for the quarter, reflecting a 112% climb from last year. This growth, primarily fueled by sales of AI processors and related parts, outran analysts’ predictions polled by StreetAccount of $28.82 billion.
The company has begun delivering its next-generation AI chip, Blackwell, to major clients like Microsoft, Oracle, and OpenAI, with around 13,000 samples dispatched. Nvidia’s CFO Colette Kress anticipates a boost in Blackwell chip shipments next year and “several billion dollars” in revenue during the fourth quarter.
Nvidia also experienced significant growth in its gaming business, with $3.28 billion in revenue compared to the expected $3.03 billion by StreetAccount. The rise can be attributed to boosted demand for GPUs for PCs and laptops and increased gaming console chip revenue.
Regardless of the strong results, uncertainties concerning potential tariff implementations by the Trump administration were voiced on the earnings call. In response, Nvidia’s CEO, Jensen Huang expressed the company’s readiness to follow and comply with any forthcoming regulations.
