AI giant Nvidia (NVDA) reported second-quarter results after the close of trading on Wednesday, beating expectations for revenue and profit, as well as its expected guidance for the next quarter.
The company reported earnings per share of $0.68 on revenue of $26.3 billion for the quarter. Analysts were expecting EPS of $0.64 on revenue of $28.8 billion. This is a significant increase from the same period last year, when Nvidia reported EPS of $0.27 on revenue of $13.5 billion.
The company also said it expects third-quarter sales to grow by $32.5 billion, plus or minus 2%, compared with analysts’ expectations of $31.9 billion.
Following the announcement, the semiconductor giant’s shares fell 6%.
Most of that revenue came from Nvidia’s vital data-center business, which posted quarterly revenue of $26.3 billion versus Wall Street’s expectations of $25 billion. The company made just $10.3 billion from the division in the same quarter last year.
Nvidia is the global leader in AI chip design and software, controlling 80% to 95% of the market, and is expected to continue to maintain that lead as it begins rolling out the next generation of its Blackwell chip line, according to Reuters.
Still, Nvidia’s rivals aren’t resting on the status quo. Earlier this month, AMD announced it was acquiring ZT Systems for $4.9 billion, a move that gives AMD more leverage in building AI system servers, which are a big driver of Nvidia’s own sales.
And while this may translate into increased sales for AMD, it doesn’t mean that Nvidia faces any major threat to its status as AI king anytime soon.
“You’re seeing emerging competitors like AMD slowly start to gain market share,” Stifel Managing Director Reuben Roy told Yahoo Finance on Monday. “But when you look at the overall infrastructure spending cycle… which we think will continue to increase, NVIDIA seems best positioned to benefit.” [spending]”
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Contact Daniel Howley at dhowley@yahoofinance.com. Follow him on Twitter. Daniel Howley.
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