Nvidia has posted record revenue as artificial intelligence demand surges, despite rising political uncertainty around global markets.
On Wednesday, the Santa Clara-based chipmaker reported $46.7bn (£34.6bn) in second-quarter revenue, a 56% increase from the same period in 2024.
Shares fell in after-hours trading after executives admitted the company was still “working through geopolitical issues.” Nvidia remains deeply involved in trade tensions between Washington and Beijing.
Rapid policy shifts under the Trump administration, aimed at protecting US leadership in artificial intelligence, add further uncertainty for the company.
AI demand fuels growth
Nvidia’s processors have become central to the global AI boom.
The company reported strong demand from major technology players, including Meta, owner of Instagram, and OpenAI, creator of ChatGPT. Both firms are rapidly expanding their AI operations.
“The AI race is now on,” said Nvidia chief Jensen Huang in a call with analysts. He revealed that four leading technology firms had doubled their annual spending to $600bn.
“Artificial intelligence will accelerate GDP growth over time,” Huang added. “We provide the infrastructure to drive that expansion.”
Analysts highlight Nvidia’s dominant position in AI chips. Colleen McHugh, chief investment officer at Wealthify, described the company as “the engine of the AI boom.”
She noted the company’s reliance on continued spending from tech giants. If investment persists, revenue and share prices should keep climbing.
Revenue from data centres rose 56% to $41.1bn but slightly missed analyst expectations. Investor Eileen Burbridge, founding partner of Passion Capital, said this weaker performance caused the “share price wobble.”
Even so, she described Nvidia’s growth as “unbelievable” while warning that excessive enthusiasm could create a bubble.
In July, Nvidia became the first company in the world valued at $4trn. The firm now forecasts $54bn in revenue for the current quarter, surpassing Wall Street estimates.
Geopolitics challenge expansion
Despite record-breaking results, Nvidia faces increasing political risks.
In July, the company announced plans to resume sales of high-end AI chips to China. The decision followed lobbying from Huang, who convinced the Trump administration to lift its ban on the H20 chip, designed for Chinese customers.
The restriction had been imposed amid concerns that the chips could support China’s military and domestic AI sector.
Executives confirmed that by late July, US officials began reviewing licenses for H20 sales. Some Chinese clients received approvals, but Nvidia has not shipped the chips.
The US government expects 15% of revenue from licensed H20 sales. Nvidia excluded the H20 from its forecast and is lobbying for approval to sell its new Blackwell chips in China, the world’s largest chip market.
Meanwhile, Beijing is accelerating efforts to develop its domestic semiconductor industry. “US export restrictions are fuelling Chinese chipmaking,” said Emarketer analyst Jacob Bourne.
He added that Nvidia’s long-term role as “the bellwether of the AI economy” may depend on whether its robotics expansion secures lasting leadership.
