NVIDIA Smashes Earnings On Surging Blackwell Sales Amid AI Boom
NVIDIA is making a habit of posting record earnings each quarter, and that trend continued into Q3 with the company reporting $57 billion in revenue. That's a giant 25% uptick from its previous quarter, and an even bigger 66% spike from the same three-month period a year ago, driven in large part by a big surge in Blackwell sales.
"Blackwell sales are off the charts, and cloud GPUs are sold out," said Jensen Huang, founder and CEO of NVIDIA. "Compute demand keeps accelerating and compounding across training and inference — each growing exponentially. We’ve entered the virtuous cycle of AI. The AI ecosystem is scaling fast — with more new foundation model makers, more AI startups, across more industries, and in more countries. AI is going everywhere, doing everything, all at once."
NVIDIA continues to defy fears of a so-called AI bubble and instead is not just riding the AI wave to new heights, it's making waves. In the high-margin data center segment, NVIDIA's third quarter revenue ballooned to $51.2 billion, up 25% sequentially and 66% year-over-year. As has been the case for a long while now, the data center is NVIDIA's biggest earner. Here's the thing—there are signs to indicate that NVIDIA is just getting started.
In September, NVIDIA announced a $100 billion partnership with OpenAI to deploy at least 10 gigawatts of NVIDIA systems for OpenAI's next-generation AI infrastructure. And just two weeks ago, OpenAI tapped Amazon Web Services (AWS) in an adjacent move to scale its AI compute on NVIDIA's Blackwell architecture in a $38 billion deal.
These are big time investments that directly and indirectly feed into the insatiable demand for NVIDIA's most advanced AI hardware. It's also worth noting that NVIDIA itself committed $5 billion in Intel common stock as part of a partnership to co-develop data center and PC chips.
Blackwell Ultra featuring 208 billion transistors and 160 streaming multiprocessors across two dies
"Blackwell Ultra is now our leading architecture across all customer categories
while our prior Blackwell architecture saw continued strong demand. H20 sales were insignificant in
the third quarter," NVIDIA CFO Colette Kress said in a statement.
The bit about H20 sales indicates that China largely remains a still untapped market for NVIDIA. While NVIDIA's been given the green light to ship its previous generation Hopper silicon to China, geopolitical tensions have stymied sales in the region. That will be something to keep an eye on going forward, especially with Huang making repeated cases to ease up export restrictions.
In NVIDIA's gaming segment, third quarter revenue tallied $4.3 billion for a slight 1% decrease from the previous quarter, but still up 30% from a year ago. While gaming is dwarfed by the data center, it's still a significant earner and NVIDIA's second largest segment.
Meanwhile, NVIDIA is seeing gains in its other segments as well, especially on a year-over-year basis. It's professional visualization division has nearly doubled from a year ago to $760 million, and same goes automotive, which contributed $592 million to NVIDIA's Q3 earnings. NVIDIA's OEM and other category more than doubled year-over-year to $174 million.
All of those figures are small in comparison to gaming and especially the data center, but they collectively added more than $1.5 billion to NVIDIA's bottom line.
Looking ahead, NVIDIA anticipates yet another record quarter, with Q4 revenue forecast at $65 billion, plus or minus 2%.
NVIDIA's share price is up more than 6.19% and climbing in after hours trading following the release of its Q3 earnings report, indicating that investors are more excited about NVIDIA's outlook versus continued chatter about an AI bubble. If that trend continues, NVIDIA could reclaim its $5 trillion market cap that it hit at the end of October.
