In its latest earnings release for the second fiscal quarter of 2025, Nvidia delivered all times record financial results with total revenue reaching US$ 46.7 billion, up 56% year-on-year (yoy), and net income rising to US$ 26.4 billion, a 59% increase. But it wasn’t enough to convince Wall Street. Investors reacted cautiously, sending the stock down about 1,5% this Thursday, as concerns grew over exposure to China.
The standout driver remained AI and data center demand. Nvidia generated US$ 41.1 billion in revenue from its data center business, highlighting the sustained appetite for advanced GPUs to support cloud services and AI applications. The company said its Blackwell chips alone contributed US$ 27 billion in sales, confirming their protagonism.
Still, the market response underlined a sense of discomfort. While demand for AI hardware remains robust, the rate or rythm of growth is starting to decelerate, marking Nvidia’s slowest revenue jump in more than two years. Analysts also pointed to tighter spending signals from hyperscale cloud providers, suggesting that the breakneck pace of GPU purchases could be reaching a plato.
China was another source of investor anxiety. Nvidia’s H20 chip, designed specifically for the asian market under US export restrictions, has not contributed to the revenue this quarter. Despite securing licenses and agreeing to pay a 15% export levy to the American Treasury, shipments have yet to materialize amid legal uncertainty and Beijing’s push for domestic alternatives. Nvidia even halted H20 production earlier this month, while the guidance for the next quarter explicitly excludes any sales to China.
The days to come
Looking ahead, Nvidia’s guidance for the third quarter projected revenue of about US$ 54 billion, with a possible error margin of 2% for higher or lower. The forecast reflects confidence in continued AI demand and new products of Blackwell systems. To reassure shareholders, the company also announced a US$ 60 billion stock buyback program, proving strong cash position.
For investors, the picture is mixed. On the positive side, Nvidia still dominates the AI hardware market and is positioned to benefit from developments this decade. It’s one of the most valuable countries in the stock market, with impressive and unprecedent US$ 4 trillion market cap. Its technological lead, coupled with strong customer relationships across cloud, enterprise, and AI labs, secures its role as the central supplier of advanced GPUs.
But headwinds remain significant. Slowing revenue growth, regulatory uncertainty, and geopolitical risks tied to Asia introduce volatility into what might otherwise look like a flawless growth story. The market reaction to these record earnings shows that even the world’s most valuable company is not immune to investor skepticism.
