NVIDIA Corporation (NVDA.US) holds up financial reports amid doubts about computing power. The trend of AI expenditure is still hot.

Chip manufacturer NVIDIA Corporation (NVDA.US), at the center of the artificial intelligence spending boom, released its fourth-quarter results. NVIDIA Corporation's Q4 revenue increased by 78% year-on-year to $39.331 billion, beating analysts' expectations of $38.05 billion; with data center revenue at $35.8 billion, a 93.32% increase year-on-year. Q4 net profit was $22.066 billion, up 72% year-on-year, corresponding to a net profit per share of $0.89, exceeding analysts' expectations of $0.84 per share. Q4 data center revenue exceeded expectations, while profit growth slowed down. The company's sales for the latest quarter exceeded NVIDIA Corporation's annual revenue two years ago, when NVIDIA Corporation's annual total revenue was $27 billion, highlighting the company's rapid growth. In the 2025 fiscal year, NVIDIA Corporation achieved total revenue of $130.497 billion, a 114% year-on-year increase; net profit reached $72.88 billion, a 145% increase year-on-year. The data center division is NVIDIA Corporation's largest source of revenue so far, generating $35.6 billion. This surpasses the average expectation of $34.1 billion. Sales related to gaming - once NVIDIA Corporation's core business - reached $25 billion, while analysts expected $30.2 billion. Automotive business revenue was $5.7 billion. Despite the fact that the company's Q4 sales exceeded analysts' expectations, it was the smallest beat since February 2023. At the same time, according to compiled data, the company's profit growth was the smallest since November 2022. NVIDIA Corporation's profit margin growth also showed signs of slowing down. In Q4, the gross margin was 73%, compared to 74.6% in the previous quarter and 76% in the same period last year. Over the past five years, NVIDIA Corporation's quarterly revenues have only fallen short of analysts' expectations once. In recent quarters, the company's performance has exceeded expectations by more than 10%, setting a high standard for its performance. Just the revenue from its data center division alone exceeds the combined revenue of its competitors Intel Corporation (INTC.US) and AMD (AMD.US). NVIDIA Corporation plays a key role in the global artificial intelligence arms race and has become one of the most valuable companies in the world. Few company earnings reports receive as much scrutiny from Wall Street and are seen as pivotal moments for the entire market. The significance of NVIDIA Corporation stems from two main factors: its massive valuation (meaning its stock price could have a significant impact on the entire market, including the blue-chip Dow Jones Industrial Average) and its role in the field of artificial intelligence (which plays a crucial role in the overall economic growth in the United States). Ahead of the earnings release, Dan Ives, Managing Director and Senior Equity Research Analyst at Wedbush Securities, expressed that it would be an "important day" for the global market seeking to gauge the trajectory of the AI revolution. NVIDIA Corporation's earnings are widely regarded as a barometer of the economy, with the past two years of economic growth largely driven by investments in artificial intelligence and data center capacity construction. More broadly, the U.S. economy is showing signs of slowing down, with questions raised about consumer strength and the higher inflation prospects associated with Trump's tariff plan. Future guidance Nevertheless, the company remains optimistic about its highly anticipated AI chip Blackwell series, which helps to reassure investors. The company generated $11 billion in revenue from Blackwell in the fourth quarter, which NVIDIA Corporation referred to as its "fastest growing product ever." NVIDIA Corporation CEO Jensen Huang said in a statement, "The demand for Blackwell is incredible." This outlook comes at an uncertain time in the artificial intelligence industry. NVIDIA Corporation's stock has fallen this year due to concerns that data center operators may slow down spending. Chinese AI startup DeepSeek has also raised concerns about high investments in computing power, which could reduce demand for NVIDIA Corporation's powerful AI chips. In this backdrop, NVIDIA Corporation has indicated that growth remains strong - even if it hasn't achieved the explosive growth that has become its hallmark. NVIDIA Corporation said in a statement that it expects sales for the first quarter to reach around $43 billion; analysts' earlier average estimate was $42.3 billion, with some as high as $48 billion. The gross margin guidance is slightly lower than expected, as the growth of the company's Blackwell chip puts pressure on NVIDIA Corporation's profit. According to data compiled by LSEG, NVIDIA Corporation expects the gross margin for the first quarter to drop to 71%, lower than the Wall Street forecast of 72.2%. NVIDIA Corporation CFO Colette Kress said that as the company increases production of Blackwell chips, it will reduce costs, improve profit margins, and expects to return to around 70% later in this fiscal year. NVIDIA Corporation's stock has fallen by 2.2% this year, while in 2023 and 2024, NVIDIA Corporation's stock saw a remarkable increase.become the world's largest semiconductor manufacturer by market value.NVIDIA Corporation has been the biggest beneficiary of the surge in artificial intelligence spending, with its revenue doubling in the past two years. Many large tech companies are investing billions of dollars in data center hardware, and NVIDIA Corporation is the leading seller of processors for creating and running artificial intelligence software. Throughout the journey, NVIDIA Corporation and its CEO have become synonymous with the AI revolution and are leading the way in its progress. Huang Renxun, as a propagator of AI technology, has been traveling around the world for most of the past two years, believing that AI technology is still in the early stages of economic dissemination. NVIDIA Corporation is known for selling graphics processors, but found that this technology can also be applied to artificial intelligence. Its chips help software models learn to recognize and respond to real-world inputs during the training process. NVIDIA Corporation's components are also used in systems, which then run software, a stage referred to as inference, powering services such as ChatGPT. Prior to the earnings report, analysts expressed concerns about the recent growth of NVIDIA Corporation's largest business data center customer service. The biggest issue is whether supply constraints and the transition to Blackwell will slow growth. New technologies are more complex and pose challenges for manufacturing. Meanwhile, DeepSeek recently released a powerful AI model, claiming that the cost of creating the model is much lower, which has exacerbated concerns. This news led to a widespread sell-off of AI-related stocks. NVIDIA Corporation lost $58.9 billion in market value in a day, setting a market record. However, major customers of NVIDIA Corporation, such as Microsoft Corporation (MSFT.US), have maintained their capital expenditure plans, indicating that AI spending will continue to grow strongly. Meanwhile, it was reported on Monday that Chinese companies are increasing their orders for NVIDIA Corporation's H20 AI chips due to the surge in demand for DeepSeek's low-cost AI model. Third Bridge analyst Lucas Keh said, "Despite DeepSeek's breakthrough, NVIDIA Corporation's momentum in the hyperscaler segment seems to be continuing." Hyperscaler refers to large cloud computing companies. eMarketer analyst Jacob Bourne said, "Despite concerns about DeepSeek's efficient model and early Blackwell deployment challenges, NVIDIA Corporation's performance once again proves that it will continue to lead the AI field. Competitors are making progress, but cutting-edge models require the advanced computing resources provided by NVIDIA Corporation."