Shares in Nvidia surged over 5% during after-hours trading following the company’s impressive quarterly earnings report. Released on Wednesday, the results highlighted a remarkable 62% increase in revenue for the three months ending in October, bringing the total to $57 billion (€49.49 billion). This surge was primarily driven by robust data-centre sales, which generated $51.2 billion (€44.43 billion), significantly outpacing analysts’ expectations of $49 billion (€42.52 billion).
In addition to the remarkable earnings, Nvidia provided a forecast for the upcoming quarter, projecting revenues of $65 billion (€56.41 billion). This outlook comfortably exceeds Wall Street’s predictions of $61 billion (€52.94 billion), further solidifying investor confidence in the chipmaker’s growth trajectory.
During an earnings call, CEO Jensen Huang addressed ongoing discussions surrounding a potential “AI bubble.” He emphasized that Nvidia’s position in the AI landscape differs significantly from other firms. “We excel at every phase of AI from pre-training to post-training to inference,” he stated, underscoring the company’s comprehensive capabilities in the sector.
Nvidia has risen to prominence within the stock market, momentarily surpassing a valuation of $5 trillion, making it the largest stock on Wall Street. This status grants Nvidia considerable sway over the S&P 500 index, adding to its ability to influence market performance.
The firm’s recent performance has positioned it as a bellwether for the burgeoning AI industry, as numerous companies rely on Nvidia’s chips to power their technological advancements. However, the broader market for AI stocks has faced challenges in recent weeks, with investors expressing concerns about overvaluation, leading to fears of an impending market downturn. Prior to Nvidia’s earnings announcement, the company’s stock had experienced an 11% decline from its peak in early November.
To alleviate worries regarding a potential bubble, Huang reiterated his confidence in the persistent demand for AI, stating, “AI is going everywhere, doing everything, all at once.” He highlighted Nvidia’s focus on key areas of innovation, including generative AI, which is capable of creating content; agentic AI, which can achieve specified goals with minimal oversight; and physical AI, which interacts with the physical realm, as seen in robotics applications.
