Nvidia: Chip company exceeds expectations after Deepseek shock
Santa Clara. Nvidia refutes the doubters: The AI boom is causing the chip company's business to continue to grow rapidly. In recent weeks, some have questioned whether as many Nvidia chips are really needed to train artificial intelligence as previously assumed. The trigger was the Chinese AI Deepseek, which was supposedly trained with very little effort.
But now Nvidia has exceeded analysts' expectations with both its sales in the last quarter and its forecast for the current quarter. CEO Jensen Huang even said that Deepseek had been "fantastic" for Nvidia. The Chinese developers had made a new technology for generating AI responses generally available. And that, in turn, is driving demand for Nvidia chips, Huang argued on CNBC. Such AI models sometimes require 100 times more computing power than previous software.
Nvidia CEO Jensen Huang.
Source: IMAGO/NurPhoto
Nvidia's chip systems are used around the world to train applications with artificial intelligence. Heavyweights such as Google or the Facebook group Meta fill entire data centers with them - but AI start-ups such as the ChatGPT inventor company OpenAI also rely on them. This key position has allowed Nvidia's business to grow explosively over the past two years.
Nvidia is currently in the process of launching a more powerful new generation of its AI chips called "Blackwell." Technical problems delayed the launch by several months, but have now been resolved, said Huang. Demand for "Blackwell" is "extraordinary," he assured. He has a better feeling about the chip system, which weighs one and a half tons and consists of more than a million parts, than he did three months ago.
In the last quarter, Nvidia's revenue shot up 78 percent year-on-year to $39.3 billion. The data center technology business grew even faster, up 93 percent to $35.6 billion. "Blackwell" brought in $11 billion of that. The bottom line was that profits rose from $12.3 billion to $22.1 billion.
For the current quarter, Nvidia predicted group sales of 43 billion dollars - with the caveat that they could be two percent higher or lower. Analysts had on average expected a forecast of around 42 billion dollars. Nvidia shares nevertheless fell by around 1.5 percent in after-hours trading in the US. One of the concerns of investors is that even tougher restrictions on the sale of modern Nvidia chips to China could slow the company's business.
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