Nvidia posts $19 billion profit as AI boom drives sales
The Nvidia display is seen on the first day of the Electronic Entertainment Expo (E3) in Los Angeles, California, June 11, 2013. The Electronic Entertainment Expo (E3), an annual trade fair for the computer and video games industry, runs from June 11-13. AFP PHOTO / ROBYN BECK - US chipmaking behemoth Nvidia said on November 20, 2024, it made a $19 billion profit on record high revenue in the last quarter as demand continued for its hardware to power artificial intelligence. Nvidia reported quarterly sales of $35.1 billion, far more than market forecasts, but shares slipped nearly 3 percent as investors tried to guage what lies ahead for the California company. (AFP Photo)
US chipmaker Nvidia posted a record-breaking profit of $19 billion in its most recent quarter, fueled by soaring demand for its hardware used to power artificial intelligence applications.
The company reported quarterly sales of $35.1 billion, exceeding market expectations by $2 billion. Nvidia’s founder and CEO Jensen Huang credited the company’s growth to the accelerating AI trend, calling it “the age of AI.”
“AI is transforming every industry, company, and country,” Huang said. “The global shift to Nvidia computing is in full steam.”
Nvidia’s latest quarterly results come as the company is seeing strong demand for its new Blackwell processing platform, which has entered full production. Alongside this, the company continues to experience high demand for its current-generation Hopper processors.
“Enterprises are adopting agentic AI to revolutionize workflows,” Huang noted. “Industrial robotics investments are surging with breakthroughs in physical AI, and countries have awakened to the importance of developing their national AI and infrastructure.”
The AI boom has already propelled Nvidia to surpass Apple in market value earlier this month, making it the most valuable company in the world. The surge in Nvidia’s stock price has sparked excitement on Wall Street, but despite strong financial results, the company’s share price fell nearly two percent in after-hours trading to $143.24. Analysts have expressed concern over Nvidia’s future profit margins, which are expected to narrow.
Jacob Bourne, an analyst at eMarketer, cautioned that the company’s success hinges on continued execution, noting that “there’s little room for execution missteps in 2025,” particularly with the launch of Blackwell and increasing competition from rivals such as AMD.
Market uncertainty, including potential trade tensions with China under a potential second term for former President Donald Trump, also weighed on investor sentiment. Nvidia relies heavily on Taiwan’s TSMC for the production of its graphics processing units, raising concerns over geopolitical risks.
Nvidia has become a critical player in the AI industry, with major tech firms like Microsoft, Google, Meta, Tesla, and Amazon relying on its chips to power generative AI models such as ChatGPT. The demand from these tech giants has driven the company’s stock price nearly three times higher this year, accounting for a significant portion of the S&P 500 index’s overall gains in 2024.
Despite its leadership in AI technology, Nvidia faces mounting challenges from both competition and the potential risks associated with geopolitical tensions, which could impact its operations in the coming years.
