AI chipmaker Nvidia crushed Wall Street’s bullish financial targets for the second quarter, forecasting strong revenue in the current quarter and saying its next-generation Blackwell chip will begin shipping to customers in the fourth quarter.
But Nvidia’s stock fell about 6% in after-hours trading Wednesday as expectations for its earnings report soared.
Nvidia reported revenue of $30 billion for the three months ended July 28, up 122% from the same period a year ago and well above the $28.9 billion analysts had expected, according to Bloomberg estimates. The company said sales of Nvidia’s Hopper GPUs drove the results. Strong demand for Nvidia’s chips boosted bottom line profits, and the chipmaker posted a gross profit margin of 75.1% and adjusted earnings per share of 68 cents.
CFO Colette Kress said in prepared remarks that the company has “changed its Blackwell GPU mask to improve production yields,” and that the company will increase production in the fourth quarter of this year.
It’s unclear whether the design flaws reported on tech news sites are related to the changes. information Earlier this month, the publisher said this would delay shipments by more than three months, which is within the company’s previous promise to ship Blackwell in the second half of the year, but at the back end of its date range.
“We expect to ship billions of dollars of Blackwell revenue in the fourth quarter, with strong Hopper demand and increased shipments expected in the second half of fiscal 2025,” Kress said.
As internet companies like Google, Meta, and Amazon spend billions of dollars on infrastructure to deliver AI services, Nvidia has become one of the biggest beneficiaries of the AI craze.
Nvidia competes with rival chipmaker AMD and startups including Cerebras and Groq, but analysts say the company now controls 90% of the AI chip market. That dominance has helped the company’s stock soar, more than doubling this year and now accounting for about 7% of the S&P 500.
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