Chip giant Nvidia beat Wall Street’s expectations for revenue and upcoming sales, easing investor concerns about heavy artificial intelligence (AI) spending that have unsettled markets.<\/p>\n
In its quarterly earnings report on Wednesday, the firm said revenue for the three months to October jumped 62% to $57bn, driven by demand for its chips used in AI data centres. Sales from that division rose 66% to more than $51bn.<\/p>\n
Fourth-quarter sales forecasts in the range of $65bn also topped estimates, sending shares in Nvidia more than 3% higher in after-hours trading.<\/p>\n
Nvidia, the world’s most valuable company, is seen as a bellwether for the AI boom. The chip-maker’s results could inform market sentiment.<\/p>\n
Chief executive Jensen Huang said in a statement that sales of its AI Blackwell systems were “off the charts” and that “cloud GPUs [graphics processing units] are sold out”.<\/p>\n
The chip-maker’s quarterly report garnered even more attention than usual on Wall Street amid mounting concern that AI stocks are overvalued.<\/p>\n
Those fears had fueled four consecutive daily drops in the S&P 500 index leading up to Wednesday, as questions swirl about returns on AI investments.<\/p>\n
The bar was high heading into Nvidia’s results.<\/p>\n
Adam Turnquist, chief technical strategist for LPL Financial, said the question was not whether the company would beat expectations, “but by how much”.<\/p>\n
Mr Huang had previously said he expected $500bn in AI chip orders through next year. <\/p>\n
Investors were looking for details about when the company expects those revenues will come to fruition, and how it plans to fulfill the orders, analysts said.<\/p>\n
The titans of the technology sector are ramping up their spending on AI, as they rush to reap the benefits of a boom that has pushed stocks to record highs.<\/p>\n
Earnings reports from Meta, Alphabet and Microsoft last month reaffirmed the colossal amounts of money<\/a> these firms are shelling out for everything from data centres to chips.<\/p>\n