Nvidia, worlds leading artificial intelligence (AI) chip manufacturer, reported a remarkable 78% year-over-year revenue surge to $39.3 billion in its latest quarter ending January 26, surpassing Wall Street expectations of $38.3 billion from a Bloomberg survey. The company’s net income also skyrocketed, climbing 80% to $22.1 billion compared to the same period last year.
This performance underscores Nvidia’s pivotal role in powering the AI infrastructure frenzy gripping Big Tech, cementing its status as a cornerstone of the AI boom. Looking ahead, Nvidia anticipates revenues of approximately $43 billion for the current quarter, signaling sustained momentum.
The results come at a pivotal moment for the chipmaker, which has been a Wall Street darling over the past two years. Nvidia’s stock, a key driver of the broader U.S. market’s ascent, soared more than 800% across 2023 and 2024, fueled by insatiable demand for its advanced chips. However, its once-electrifying influence on stock markets has tempered, with shares showing little movement in after-hours trading following the earnings release, despite a nearly 4% gain earlier in the day.
Blackwell Chips Shine, DeepSeek Fears Fade
Central to Nvidia’s success is its latest-generation Blackwell chip, which raked in $11 billion in data center revenue, a near doubling from the prior year, as tech giants scramble to bolster their AI offerings. Chief Executive Jensen Huang dismissed concerns sparked last month by Chinese AI startup DeepSeek, which claimed it could train models using less advanced chips than those of rivals like OpenAI.
That assertion triggered a record 17% one-day plunge in Nvidia’s stock, raising doubts about future demand. Yet Huang, speaking during an analyst call, emphasized that “amazing” demand for Blackwell chips remains intact.
Far from posing a threat, Huang argued that DeepSeek’s emergence and its new “reasoning” models like the R1 has only amplified global enthusiasm for AI, driving even greater need for powerful chips. “DeepSeek threats or disruptions were not evident in Blackwell’s chip demand or data center revenues,” noted Dec Mullarkey, managing director at SLC Management. While the earnings weren’t a blockbuster blowout, they revealed no significant weaknesses, reinforcing Nvidia’s resilience.
Production Hiccups and Profit Margin Pressures
The transition to Blackwell hasn’t been without challenges. Early production snags and reports of overheating in some chip iterations raised eyebrows, but Wednesday’s results suggest Nvidia has navigated the shift from its previous architecture smoothly.
Chief Financial Officer Colette Kress acknowledged a dip in profit margins, attributing it to the “more complex and higher cost” Blackwell systems. Despite these hurdles, the company’s ability to deliver strong revenue growth signals operational strength as it scales up to meet escalating demand.
Geopolitical Clouds Loom Over Nvidia’s Horizon
Nvidia’s fortunes, however, are not immune to broader uncertainties. Analysts have flagged potential risks from U.S.-China geopolitical tensions, particularly as both nations vie for AI supremacy. The Biden administration’s late-term proposal of an “AI diffusion” export control regime aimed to tighten restrictions on China’s access to cutting-edge chips, a move Nvidia publicly criticized for threatening competitiveness and innovation.
The incoming Trump administration shows no signs of easing this stance, with the president-elect threatening new tariffs on semiconductors from Taiwan, a key manufacturing hub.
“At this point, it’s a little bit of an unknown until we understand further what the U.S. government’s plan is,” Kress said when pressed on tariffs. Nvidia’s exposure to these dynamics underscores the delicate balance it must strike as a global leader in a politically charged industry.
A Shift in Market Dynamics
While Nvidia remains a powerhouse, its days of single-handedly igniting Wall Street’s AI fervor may be waning. The stock, down about 2% year-to-date in 2025 after last month’s DeepSeek-induced tumble, has clawed back some losses but lacks the explosive momentum of prior years.
Investors appear to be recalibrating expectations, factoring in both competitive pressures and macroeconomic risks. Still, the company’s ability to post $39.3 billion in quarterly revenue, above forecasts and project $43 billion for the next quarter demonstrates its enduring appeal in an AI-driven world.
For now, Nvidia’s latest earnings paint a picture of a company thriving amid the AI revolution, shrugging off would-be disruptors like DeepSeek, and adapting to a complex global landscape. As Huang put it, the arrival of new players has only “ignited” enthusiasm for AI ensuring Nvidia’s chips remain at the heart of this technological transformation.
