Key facts
- Nvidia shares rose approximately 6% in pre-market trading.
- The company projected 70% revenue growth for the next fiscal year.
- Nvidia forecast current-quarter sales above Wall Street estimates.
- Second-quarter revenue reached $96.2 billion, exceeding expectations.
- Data center sales contributed $89 billion to the second-quarter revenue.
- At least 10 brokerages raised their price targets on Nvidia's shares.
Nvidia shares surged approximately 6% in pre-market trading as investors responded positively to the chipmaker's strong long-term outlook and robust quarterly results. The company projected 70% revenue growth for the next fiscal year and forecast current-quarter sales above Wall Street estimates, indicating that the demand for AI infrastructure remains strong. This outlook provides reassurance to investors after a recent dip in Nvidia's stock price.
Nvidia reported second-quarter revenue of $96.2 billion, surpassing expectations, with data center sales reaching $89 billion, an increase of 117% year-over-year. At least 10 brokerages have raised their price targets on the stock following the announcement. Analysts at Morgan Stanley highlighted the remarkable figure of 70% growth under supply constraints and noted that Nvidia's move into cloud revenue-sharing could serve as a catalyst.
CEO Jensen Huang stated that artificial intelligence has reached an "inflection point," moving from experimentation to widespread deployment. Nvidia indicated that demand for AI is expanding beyond hyperscalers, citing growth from AI labs and increased capacity at companies like CoreWeave and Nebius, as well as a strengthened partnership with Amazon Web Services. Despite the positive outlook, concerns persist regarding supply bottlenecks and the impact of "extreme" memory costs on gross margins, which are expected to decrease in the coming year.