Nvidia shares rise after earnings top estimates, guides to $108 billion in revenue next quarter
Nvidia reported strong quarterly revenue of $96.2 billion, exceeding analyst expectations, while forecasting $108 billion for the next quarter. Despite the growth, shares faced pressure due to concerns over declining gross margins and rising infrastructure costs.
Why it matters
As a leader in AI hardware, Nvidia's financial performance serves as a bellwether for the broader artificial intelligence industry and tech sector health.
Total quarterly revenue of $96.2 billion beat consensus forecasts for $92.27 billion. Data center revenue was $89 billion versus estimates for $85.4 billion. Meanwhile, earnings per share of $2.22 beat estimates for $2.09.
Shares of the tech giant were up about 4% in after-hours trading while bitcoin BTC $ 78,808.48 remains in a tight range just above $78,000.
“AI has reached its inflection point,” said CEO Jensen Huang. “Now compute is revenue … And demand is accelerating.”
Third-quarter revenue guidance was $108 billion versus Street forecasts for $103.9 billion. The $100 billion level is significant, as only 9 S&P 500 companies have previously reported $100 billion or more in quarterly revenue.
Gross margin for the next quarter, however, was guided to 74%, down from 75% in the second quarter, which likely weighed on the shares immediately after the earnings news came out.
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