Nvidia, a leading technology firm headquartered in Santa Clara, California, disclosed a notable increase in its fourth-quarter profits and sales, attributing this growth to the rising demand for its specialized Blackwell chips. These chips are instrumental in powering advanced artificial intelligence systems, and their high demand pushed Nvidia’s stock higher in after-hours trading.
For the quarter ending January 26, Nvidia reported revenues amounting to $39.3 billion, marking a 12% increase compared to the preceding quarter and a 78% increase year-on-year. After adjustments for one-off items, earnings stood at 89 cents per share. According to Nvidia Founder Jensen Huang, demand for their Blackwell chips is remarkable, indicating that expansion in compute for training enhances the intelligence of models, while increases in compute for long-term thinking produce smarter answers.
Nvidia has significantly increased production of Blackwell AI supercomputers, achieving several billion dollars in sales in the first quarter, as per Huang. He further commented on the rapid advancements in AI, stating that agentic AI and physical AI are paving the way for AI to revolutionize major industries.
The earnings reported surpassed Wall Street expectations, with analysts predicting adjusted earnings of 85 cents per share on $38.1 billion revenue, as compiled by FactSet. Nvidia reported a net income of $22.06 billion, which exceeded analysts’ forecast of $19.57 billion. Nvidia anticipates continued sales growth and projects revenue of approximately $43 billion for the first quarter of fiscal 2026.
A significant portion of Nvidia’s revenue growth was driven by data center sales, which generated $35.6 billion in fourth-quarter revenue, up by 93% from the previous year. This increase aligns with former President Donald Trump’s promotion of a joint venture to invest up to $500 billion in AI-related infrastructure in collaboration with OpenAI, Oracle, and SoftBank under the Stargate project. Nvidia is among the partners in this initiative.
During the earnings call, Nvidia Chief Financial Officer Colette Kress disclosed that fourth-quarter Blackwell sales surpassed company expectations. “We achieved $11 billion of Blackwell architecture revenue in the fourth quarter of fiscal 2025, marking the fastest product ramp in our company’s history,” she said. Blackwell sales were primarily driven by large cloud service providers, which contributed to around 50% of data center revenue.
Emerging as a pivotal player in the AI boom, Nvidia has become the second-largest company on Wall Street, with a market value surpassing $3 trillion. Its stock performance carries significant weight in the S&P 500 index, second only to Apple. In just two years, Nvidia’s valuation rose from below $600 billion.
The prospering AI sector, including Nvidia, has played a major role in the S&P 500 reaching new highs, notwithstanding concerns about persistent inflation and potential economic repercussions from former President Donald Trump’s policies. However, these policies, particularly tariffs, remain uncertain until further clarity from the Trump administration is provided. Nvidia pledges compliance with any forthcoming export controls or tariff regulations.
This fourth-quarter earnings report follows claims by the Chinese company DeepSeek, alleging the development of a large language model competitive with ChatGPT, utilizing Nvidia chips effectively for cost-efficient data training. This announcement briefly impacted Nvidia’s market value, causing a temporary loss of $595 billion. Nevertheless, Nvidia commended DeepSeek for its advancement in AI, employing accessible models and computing resources that adhere to export regulations.
DeepSeek’s AI model, designated R1, has stirred global interest. According to Huang, it represents a significant innovation, having open-sourced a top-tier reasoning AI model. Numerous AI developers are now adopting the R1 model or similar techniques to boost their models’ performance capabilities.
Addressing investors, Huang remarked on the upcoming “next wave” of AI, focusing on “agentic AI for enterprise, physical AI for robotics, and sovereign AI” as regions cultivate AI frameworks for their ecosystems. Nvidia continues to play a central role in these developments.
