NVIDIA Corp (NASDAQ:NVDA, ETR:NVD) saw $90 billion wiped from its value after-hours as the AI chipmaker dealt with the pitfalls of being the world's largest company - namely, exceeding expectations is not always enough.
The shares slid 2.5% despite a robust third-quarter performance. The bone of contention was the outlook for the business, which didn't have the knock-it-out-the-park narrative required to maintain the 'overbought' momentum that has seen the stock power ahead 202% in the year-to-date.
Revenue nearly doubled year-on-year, rising 94% to $35.1 billion, surpassing analyst expectations of $33.25 billion.
While growth slowed compared to the previous quarter, Nvidia’s revenue guidance for the current quarter, estimated at $37.5 billion, aligned with market predictions.
The company's new Blackwell chips, introduced earlier this year, are under scrutiny following reports of overheating issues and earlier production challenges.
However, CEO Jensen Huang stated that sales of Blackwell chips exceeded forecasts and emphasised the supply chain’s efforts to scale production.
Nvidia continues to face supply constraints with its manufacturing partner, TSMC, impacting rollout speed to data centres.
Data centre revenue, including Nvidia’s Hopper chips, surged 112% year-on-year to $30.8 billion, reflecting big tech companies’ continued investment in AI infrastructure.
Nvidia’s gross margins stood at 75%, meeting estimates, with adjusted net income at $20 billion.
The stock was marked $3.69 lower to $145.89. With a market capitalisation of $3.58 trillion, Nvidia maintains its slender lead over rival Apple valued at $3.46 trillion.