Nvidia Posts Record Quarterly Revenue Driven by AI Demand

Nvidia, the American chip and software manufacturing giant, announced record-breaking quarterly revenues of $35.1 billion for the third quarter of 2024, marking a 17% increase from the previous quarter and a staggering 94% year-on-year growth. This surge was fueled by a rising global demand for artificial intelligence (AI) solutions.

The company’s profits more than doubled, reaching $19.3 billion (equivalent to $0.78 per share), compared to $9.2 billion ($0.37 per share) in the same quarter last year. Nvidia's data center segment demonstrated exceptional performance, with revenues soaring 112% to $30.8 billion, surpassing analyst expectations.

Expansion Plans and Production Challenges

Nvidia unveiled plans to launch new systems powered by its BlackWall AI chip in the fourth quarter of the year. However, the company warned that demand for both BlackWall and Hopper systems might outstrip production capacity in the coming months, potentially posing supply challenges amid soaring interest in AI technologies.

Investor Reaction and Market Impact

While Nvidia forecasted fourth-quarter revenues of $37.5 billion, representing a 2% quarterly increase, the figure exceeded the average analyst estimate of $37.1 billion, according to Bloomberg data. However, it fell short of the upper-end estimate of $41 billion, dampening investor sentiment and leading to a 2.53% decline in Nvidia’s stock during after-hours trading. Shares dropped $3.69, settling at approximately $142.20.

Beating Adjusted Earnings Expectations

On an adjusted basis, Nvidia reported third-quarter profits of $20 billion ($0.81 per share), outperforming the average analyst projection of $0.75 per share.

Despite the stellar results, Nvidia’s stock movement reflects mixed investor sentiment as expectations for sustained growth remain high. The company continues to reinforce its leadership in the AI and semiconductor sectors, positioning itself to meet the ever-growing demand for cutting-edge technology solutions.

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