AI chipmaker Nvidia’s revenue jumps 69% to $44.1 billion
- The San Juan Daily Star
- 3 days ago
- 4 min read
By Tripp Mickle
Nvidia’s business prospects have been whipsawed by the U.S. government lately. Last month, the government blocked the sale of artificial intelligence chips to China. Weeks later, it approved the sale of similar chips to the Middle East.
Amid the turmoil, Nvidia still maintained its breakneck growth as the leading provider of the computer chips used for building AI.
Nvidia said Wednesday that sales in its most recent quarter rose 69% from a year earlier to $44.1 billion. Its net income rose 26% to $18.78 billion. The company exceeded Wall Street’s expectations for sales of $43.28 billion, but fell short of predictions for a profit of $19.49 billion.
Nvidia’s revenue and profit rose even though, it said Wednesday, the Trump administration’s restrictions on chips to China would cost it $4.5 billion, $1 billion less than it estimated in mid-April. The restrictions have pushed Nvidia out of the market for AI chips in China, the world’s largest buyer of semiconductors, which are used to power smartphones, cars and other electronics.
Nvidia also projected that revenue in the current quarter would rise 50% from a year ago to $45 billion, as it expands sales of its newest AI chip, Blackwell. The sales forecast is in line with Wall Street’s prediction of $45.75 billion, suggesting that the tech industry’s embrace of AI is in its early stages, with ample room to run.
Shares in Nvidia rose more than 4% in after-hours trading. It finished the trading day as the second-most-valuable company in the world behind Microsoft and ahead of Apple, with a market value of $3.3 trillion.
“Every nation now sees AI as core to the next industrial revolution,” Jensen Huang, Nvidia’s CEO, said during a call with analysts Wednesday.
The company is showing its strength, even among the tech industry’s largest companies. For the first time in the AI era, its quarterly sales surpassed those of Meta, the social media pioneer. Nvidia’s net income was 13% larger than Meta’s profit in their most recent quarters.
Nvidia has been the early winner in the tech industry’s race to develop artificial intelligence. Huang cornered the market on AI chips by being the first chipmaker to develop the software and servers that would train AI systems to recognize images and predict words.
But government officials have grown increasingly alarmed about the way adversaries such as China could use AI to develop autonomous weapons and coordinate military strikes. Those worries have led Washington officials to crack down on Nvidia’s sales.
Huang spent much of the past few months pushing back on that by traveling the world to meet with government officials. An April meeting with President Donald Trump proved to be unsuccessful when the Commerce Department later pushed forward on limiting sales to China. Huang later flew to Beijing, where he pledged to find a new way to sell chips there, and then to Taiwan, where he complained that the U.S. government’s restrictions had been a failure.
His efforts haven’t changed the trajectory of Nvidia’s business in China. Since the U.S. government began restricting chip exports, Nvidia’s sales in China have been cut to 13% of total revenue from 21% two years ago. The company said it would lose $8 billion in the current quarter because of the Trump administration’s restrictions.
Wednesday, Huang broadened his attack on U.S. restrictions of chip sales to China. He said in prepared remarks that China was the world’s largest AI market and that the company that won there would be the global leader. He said the U.S. assumption that it could prevent China from manufacturing competitive chips “was always questionable, and now it’s clearly wrong.”
“Shielding Chinese chipmakers from U.S. competition only strengthens them abroad and weakens America’s position,” Huang said.
But Huang has had more success in persuading the U.S. government to loosen up sales to other countries. After his urging, the Trump administration rolled back Biden-era rules that restricted AI chip sales abroad. The change paved the way to a blockbuster deal this month between the United States and the United Arab Emirates to build the world’s largest international hub of AI data centers.
Nvidia has made selling more chips to governments a key part of its strategy. The company relies on customers like Microsoft, Amazon, Google and Meta for a large portion of its sales. It wants to expand its customer base by adding buyers across Europe and Asia, including the Middle East, where AI could be part of the national infrastructure much like a telecommunications network, Huang has said.
The United States also doesn’t have the energy resources to support the current demand for data centers. The maximum amount of power available this year for many companies is 50 megawatts, enough to support about 25,000 of Nvidia’s newest AI chips. By comparison, OpenAI is planning a 200-megawatt data center next year at an AI campus in Abu Dhabi that could support 100,000 of Nvidia’s chips.
The deal was important because Nvidia has a window to sell to countries before competition for AI chips increases, said Holger Mueller, principal analyst at Constellation Research, a tech research firm.
“Now they’re the only game in town,” Mueller said of Nvidia. “These Middle East countries really need them.”
Nvidia said it had improved manufacturing of its new Blackwell chips. Cloud computing companies are deploying about 72,000 Blackwell chips a week, which cost more than $30,000 each.
“We’re going to keep our supply chain quite busy for many more years,” Huang said.
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