Nvidia’s revenue rose 78% last quarter, beating analysts’ expectations

Many investors were awaiting Nvidia’s quarterly earnings with some trepidation, as the traditional narrative of an inevitable decline in demand for computing accelerators was supplemented by the DeepSeek factor, which theoretically works in the same direction. In reality, Nvidia’s revenue last quarter exceeded market expectations, as well as its forecast for the current quarter.

Image source: NVIDIA

The chronological isolation of Nvidia’s reporting event is due to the fact that the fourth quarter of the 2025 fiscal year in the company’s calendar did not end until January 26 of this year. The company’s more optimistic report compared to investor expectations did not cause an increase in the share price after the close of trading. On the contrary, it fell by 1.5 percent, as investors realized that the company’s revenue growth rate was slowing compared to the first two years of the AI ​​boom.

Nvidia’s quarterly revenue increased by 78.8% year-on-year to $39.33 billion, which is higher than the expected $38.05 billion. Earnings per share reached $0.89, which is also higher than the expected value of $0.84. In the current quarter, the company expects to earn $43 billion versus the $41.78 billion expected by investors, this figure will correspond to an annual growth of 65%. Considering that a year ago, such growth reached 262%, this could be a bit of a disappointment for investors.

According to statements by Nvidia representatives, the problems with the release of Blackwell accelerators that were observed at the start were resolved, and in the past quarter, deliveries of this product brought the company $11 billion in revenue. Their expansion can be called the fastest in the history of the company, according to financial director Colette Kress. Blackwell accelerators were mostly purchased by cloud service providers; clients of this class provided half of the total revenue of Nvidia’s server division.

Overall, the data center segment increased Nvidia’s revenue by 93% to $35.6 billion, which also exceeds investor forecasts. Directly, the supply of computing tools in the server segment increased revenue by 116% to $32.6 billion, but network solutions reduced it by 9% to $3 billion. Nevertheless, Nvidia’s management proudly noted that the components of the network infrastructure of the Stargate project in the United States will be supplied by this company. The growth in revenue from the supply of computing solutions for data centers in the last quarter was due not only to high demand for Blackwell accelerators, but also to a consistent increase in demand for H200 accelerators of the Hopper generation. The data center segment provides up to 91% of Nvidia’s total revenue, and over the past two years, its revenue has increased approximately tenfold.

Nvidia’s net profit grew by 80% to $22.1 billion last quarter. The profit margin fell from 76% to 73%, but the company explains this by increased costs for the expansion of Blackwell accelerators, while expecting to improve profitability in the second half of the year. Last quarter, operating expenses grew by 48% to $4.7 billion. Operating profit grew by 77% to $24 billion.

While Nvidia’s revenue in the computing and networking segment increased by 101% to $36 billion in the fourth quarter, its graphics solutions shipments reduced core revenue by 22% to $3.3 billion. In the gaming segment, the company’s revenue fell by 11% year-on-year and by 22% sequentially to $2.54 billion. The company’s CFO explained this dynamic by the shortage of both Blackwell and Ada Lovelace graphics processors. In fiscal 2025, overall gaming revenue grew by 9% to $11.35 billion, largely due to the popularity of the GeForce RTX 40 series graphics cards.

For the full fiscal year, Nvidia’s revenue grew by 114% to $130.5 billion, operating profit grew by 147% to $81.5 billion, net profit increased by 145% to $72.9 billion, and the profit margin rose from 72.7 to 75%. In fact, the slowdown in the growth rate of financial indicators for the fourth quarter alone caused concern among some investors. In the current calendar year, Nvidia’s revenue should increase significantly, as stated by the CEO.

The company’s management predictably made emotional statements aimed at convincing skeptics. Nvidia CEO and founder Jensen Huang called the demand for Blackwell “amazing.” The company’s CFO added that “reasoning language models require 100 times more compute.” Huang echoed this sentiment, traditionally bolstering it with a prediction about the upcoming emergence of next-generation AI algorithms that will require “millions of times more compute.” Already, he said, the bulk of the computing load on AI infrastructure involves reasoning.

The head of Nvidia ignores the threat from cloud providers developing their own accelerators. As he is convinced, the existence of such chips does not mean that they are used on a mass scale.

Regarding the influence of DeepSeek, the head of Nvidia reiterated that the spread of such more efficient models will only contribute to the increase in demand for computing accelerators. He called DeepSeek’s breakthrough “an excellent innovation.” He did not undertake to estimate the potential impact of US customs tariffs on Nvidia’s business. “AI is moving forward at the speed of light,” Jensen Huang summed up his assessment of the current state of the market.