Nvidia's Record Sales Surge Stalls Amidst Market Skepticism and Supply Chain Woes
1min read In recent market developments, Nvidia reported record third-quarter sales of $35.1 billion, signifying a 17% sequential increase and a 94% year-over-year increase. Despite this impressive growth, it marked the first time since the 2024 fiscal year’s first quarter that the annual growth rate did not double, indicating a deceleration in momentum.
The company's guidance for the fourth quarter projects a revenue rise of approximately 70% from a year earlier, translating to $37.5 billion, slightly above analysts' consensus of $37.1 billion but below the highest expectations of $38.8 billion. Nvidia's shares, which initially dropped by nearly 0.8% after the earnings release, experienced an after-hours dip of up to 5% before stabilizing.
CEO Jensen Huang, along with other executives, sought to reassure investors during a post-earnings conference call by addressing concerns over their Blackwell architecture chips. Huang confirmed that previously reported design defects have been resolved, and production is in full swing, affirming that demand is expected to significantly surpass expectations in coming quarters.
Despite these reassurances, industry experts have mixed views on Nvidia's prospects. Concerns linger over potential supply chain constraints that may impact the immediate trajectory of Nvidia's stock price. Nevertheless, some analysts maintain an optimistic stance, suggesting that Nvidia remains a potential core holding for technology-focused investment portfolios, provided no unforeseen structural issues arise.
Market analysts project that Nvidia's revenues for the fiscal year 2025 could more than double compared to 2024, driven by vigorous demand for the Blackwell chips. Additionally, other product lines, such as the Hopper series chips, are predicted to generate substantial revenue, given the burgeoning AI and data center market demands.