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Nvidia’s profits and revenues skyrocketed the last quarter as they rushed among technology companies to maintain demand for artificial intelligence infrastructure for advanced chips, which has become one of AI Boom’s biggest winners.
Revenue rose 78% year-on-year to $39.3 billion, surpassing the Bloomberg survey estimate of $38.3 billion. Net profit surged to $22.1 billion, up 80% from the previous year. The group is expected to report revenue of approximately $430 billion in the current quarter.
Nvidia has been one of Wall Street’s top-performing stocks over the past two years, helping to bring the US market higher as investors bet on insatiable demand for chips.
The stock’s record-breaking run was punctured last month after Chinese AI startup Deepseek claimed it could train models with more advanced chips than rivals such as US-based Openai.
In the first string of results since the bills questioned future demand for chips, Nvidia CEO Jensen Huang said on Wednesday that there was “surprising” demand for the group’s latest generation of blackwell chips.
Datacenter revenue almost doubled in the quarter ending January 26th as large tech companies quickly built AI products. Blackwell delivered $11 billion in quarterly revenue.
Huang dealt with Deepseek in particular during his call with analysts, with new “inference” models such as Deepseek’s R1 consuming much more AI chip power than its predecessor, and the sudden arrival in the scene gave the technology a “global enthusiasm.”
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Dec Mullarkey, Managing Director, SLC Management, said: “The revenue was not blown away, but it also showed no inconspicuous vulnerabilities.”
The Blackwell rollout was the first scratch and hit, along with reports of production issues and several iterations of chip overheating on the server. However, Wednesday’s results suggest that the transition from previous chip architecture is progressing smoothly.
NVIDIA’s Chief Financial Officer Colette Cress said gross profits have slipped due to the transition to a “more complex and higher cost” Blackwell system, despite the pace of net profit growth exceeding the pace of revenue. Total margin, a measure of profitability excluding operating expenses, was 73% in the fourth quarter, compared to 76% in the same period last year.
Despite Huang trying to reassure investors about the long-term demand for its chips, Nvidia has no longer been an electrification force for the stock market for most of the last two years, where quarterly results have fueled Wall Street’s enthusiasm for AI.
Nvidia’s shares fell 1.2% shortly after the opening bell on Wall Street, but were trading on positive territory during pre-market trading before US President Donald Trump said he would impose an additional 10% tariff on imports from China. Shares rose almost 4% on Wednesday, before the results were announced.
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Stocks have recovered some of that losses since the record plunge of 17% last month, a one-day plunge after Deepseek surprised the AI industry, but this year it has fallen by around 2%. They surged more than 800% between 2023 and 2024.
Ahead of Wednesday’s outcome, analysts also flagged uncertainty about how new US export controls and tariffs will affect NVIDIA.
The group is exposed to geopolitical tensions between Washington and Beijing, and is engaged in an arms race through AI technology.
On the final day of the Joe Biden administration, a new “AI Propagation” export control regime was also proposed. This aims to make it difficult for China to use other countries to avoid US export restrictions on AI chips.
Nvidia has taken the rare step of publicly criticizing the rules, saying it will weaken competitiveness and undermine innovation. But Donald Trump’s administration has shown few indications of turning the course back on its attempts to crack down on China’s cutting-edge chip access. The president threatened new tariffs on Taiwan’s semiconductors.
Regarding tariffs, “It’s a bit unknown at this point… Until we understand more about what the US government’s plan is,” Cress said.
Additional Reports by George Steer and Tim Bradshaw
