Nvidia reports another growth leap

Nvidia has made another leap in growth. The American semiconductor company has exceeded analysts' expectations with its business results presented after the stock market closed on Wednesday. The company is also confident about the next reporting quarter, although it expects a slightly lower growth rate. CEO Jensen Huang said in a statement that demand for Nvidia's new Blackwell chip generation is "astonishing".

The share price was slightly up in after-hours trading. Nvidia has been one of the biggest winners on the stock market in recent years, with the share price almost tripling in 2024 alone. This reflects Nvidia's dominant position to date in the market for chips for applications related to artificial intelligence. The company currently has a market capitalization of 3.2 trillion dollars , only the electronics group Apple is more valuable.

However, there have been increasing concerns recently about whether Nvidia can continue its rapid growth. This has to do with the recent excitement surrounding Deepseek. The Chinese start-up company caused a sensation in January with an AI model that is said to be able to keep up with programs like ChatGPT from Open AI, but was said to have been much cheaper to develop. This raised questions about whether America's previous leadership position in the AI ​​business is under threat - and also whether Nvidia's expensive chips are really necessary for certain AI tasks. Nvidia's share price plummeted by 17 percent in a single day at the time, and its market value shrank by almost 600 billion dollars. These losses have since been partially, but not entirely, made up.

Nvidia CEO Jensen Huang has so far been unimpressed by such concerns. In an interview a few days ago, he described reactions on financial markets that AI is now "at an end" as exaggerated. "The exact opposite is the case." Advances such as those made by Deepseek would expand the market. On Wednesday, he said that Deepseek had "sparked global enthusiasm" and was "an excellent innovation." Almost every AI developer works with the model.

Huang added that he remains optimistic in the short, medium and long term, and that the industry is "only at the beginning of a new era." Nvidia is also increasingly highlighting the potential uses of its chips when it comes to applying AI models rather than developing them, which the industry describes as "inference." Many of Nvidia's most important customers, including technology giants such as Microsoft, Meta and Google's parent company Alphabet, also recently said when presenting their results that they wanted to continue to invest aggressively in their AI projects.

For the final quarter of the 2024/2025 fiscal year, which ended on January 31, Nvidia reported a 78 percent jump in sales to $39.3 billion; analysts had expected an average of $38.1 billion. The Blackwell chips launched last year alone contributed sales of $11.0 billion. Chief Financial Officer Colette Kress said that never in Nvidia's history had a product generated so much sales so quickly.

Nvidia's net profit rose 80 percent to $22.1 billion, with earnings per share of 89 cents being 5 cents higher than expected. For the full fiscal year, revenue more than doubled to $130.5 billion, and net profit was $72.9 billion.

As Nvidia grows, it becomes more difficult to maintain its growth rates. The company is predicting a 65 percent increase in sales for the coming quarter, which is less than in the past three months. But that was better than analysts expected.

Nvidia now faces some serious competitors in the AI ​​chip business. These include traditional semiconductor suppliers such as Advanced Micro Devices (AMD). But some Nvidia customers such as Amazon, Google and Microsoft are also developing their own chips, although they continue to buy heavily from Nvidia. There are also a number of young start-ups that specialize in AI chips.

Analyst Jacob Bourne of the market research company Emarketer said that Nvidia's business figures underlined its leading position in the market and proved skeptics wrong. "Nvidia's dominance over the market remains unmatched."