Artificial intelligence (AI) chip giant Nvidia says its revenues for the three months to the end of July more than doubled compared to a year earlier, hitting a record $30bn (£24.7bn).
However, the firm’s shares fell by more than 6% in New York after the announcement.
Nvidia has been one of the biggest beneficiaries of the AI boom, with its stock market value soaring to more than $3tn.
The sky-high expectations are driven by its valuation, which has surged ninefold in value in under two years thanks to its dominance of the AI chip market.
It was the seventh quarter in a row that Nvidia had beaten analysts’ expectations on both sales and profits.
A “watch party” had been planned in Manhattan, according to the Wall Street Journal, while Mr Huang, famed for his signature leather jacket, has been dubbed the “Taylor Swift of tech”.
Alvin Nguyen, senior analyst at Forrester, told the BBC both Nvidia and Mr Huang have become the “face of AI”.
This has helped the company so far, but it could also hurt its valuation if AI fails to deliver after firms have invested billions of dollars in the technology, Mr Nguyen said.
Mr Nguyen also said Nvidia’s first-mover advantage means it has market-leading products, which its customers have spent decades using and has a “software ecosystem”.
He said that rivals, such as Intel, could “chip away” at Nvidia’s market share if they developed a better product, though he said this would take time.
Nvidia, the maker of AI chips, reports that its revenue for the three months ended July 31 more than doubled from the same period last year, reaching a record $30 billion (£24.07 billion).
Nonetheless, following the announcement, the company’s shares in New York dropped by more than 6%.
Nvidia’s stock market value has surged to over $3 trillion, making it one of the largest winners from the AI boom.
Just this year, the company’s shares have increased by more than 160 percent.
The scale of the beat today appears to have let us down a little, according to Matt Britzman, senior equity analyst at Hargreaves Lansdown. “It’s less about just beating estimates now, markets expect them to be shattered,” the analyst stated.
Its valuation, which increased ninefold in less than two years due to its dominance of the AI chip market, is the driving force behind the extremely high expectations.
Operating income increased by 174% to $18.6 billion during the same period last year, resulting in massive profits.
Nvidia had surpassed analyst expectations for both sales and profits for the seventh consecutive quarter.
“Every industry will be revolutionized by generative AI,” stated Jensen Huang, CEO of Nvidia.
The announcements have turned into a quarterly ritual that causes a panic on Wall Street as traders buy and sell shares.
The Wall Street Journal reported that a “watch party” was being organized in Manhattan. Mr. Huang, who is well-known for his trademark leather jacket, has been dubbed the “Taylor Swift of tech.”.
Nvidia and Mr. Huang have both taken on the role of the “face of AI,” according to Forrester senior analyst Alvin Nguyen, who spoke with the BBC.
Although this has benefited the business thus far, Mr. Nguyen noted that if AI falls short of expectations after businesses have invested billions of dollars in the technology, it could negatively impact the company’s valuation.
“One thousand AI use cases is insufficient. A million is needed. “.”.
Mr. Nguyen added that Nvidia has a “software ecosystem” and products that lead the market that its customers have been using for decades because of its first-mover advantage.
Though he acknowledged that it would take time, he predicted that competitors like Intel could “chip away” at Nvidia’s market share if they produced a superior product.
