• Nvidia reported third-quarter earnings that beat expectations for sales and earnings while delivering a better-than-expected forecast for the current quarter.
• Revenue continues to surge at Nvidia, rising 94% on an annual basis during the quarter that ended on Oct. 27.
• Many of Nvidia's end-customers, such as Microsoft, Oracle and OpenAI, have started receiving the company's next-generation AI chip called Blackwell.

Nvidia reported third-quarter earnings that beat expectations for sales and earnings while delivering a better-than-expected forecast for the current quarter. The results show that Nvidia is continuing to grow quickly while demand for its powerful artificial intelligence chips remains high.

Shares fell 2% in extended trading.

Here's how the company did, compared to LSEG analysts' expectations:

• Earnings per share: 81 cents adjusted vs. 75 cents expected
• Revenue: $35.08 billion vs. $33.16 billion expected

Nvidia said it expects about $37.5 billion plus or minus 2% in current-quarter sales, versus $37.08 billion expected by analysts polled by LSEG.

The fourth-quarter forecast implies year-to-year growth of about 70% from a year earlier, a slowdown from 265% annual growth in the same period a year prior.

Revenue continues to surge at Nvidia, rising 94% on an annual basis during the quarter that ended on Oct. 27. That is still a consecutive slowdown from the previous three quarters, when sales rose 122%, 262%, and 265%, respectively.

Nvidia has been the primary beneficiary of the ongoing artificial intelligence boom. Shares have nearly tripled so far in 2024, making it the most valuable publicly traded company.

That has been driven by Nvidia's data center business, which records sales from AI processors and related parts and makes up the vast majority of Nvidia's revenue. Nvidia posted $30.8 billion in its data center division, rising 112% from a year ago, while analysts polled by StreetAccount were expecting $28.82 billion in revenue.  

Not all of Nvidia's data center sales are chips. About $3.1 billion of it was due to sales of networking parts, the company said.

Net income during the quarter rose to $19.3 billion, or 78 cents per share, versus $9.24 billion, or 67 cents per share, in the year-ago period. Nvidia's gross margin rose to 73.5%, slightly higher than analysts' estimates, and the company said the increase was because it is selling more data center chips.

Many of Nvidia's end-customers, such as Microsoft, Oracle and OpenAI, have started receiving the company's next-generation AI chip called Blackwell. Nvidia Chief Financial Officer Colette Kress said on a call with analysts that 13,000 samples of the chip have been shipped to customers. Nvidia CEO Jensen Huang said in a statement that Blackwell is in "full production."

"Every customer is racing to be the first to market," Kress said. "Blackwell is now in the hands of all of our major partners, and they are working to bring up their data centers."

Shipments of Nvidia's Blackwell chips will ramp up next year, Kress said, and she repeated that the company is on track for "several billion dollars" of Blackwell revenue in the company's fourth quarter. Nvidia also said sales for its current-generation AI chip, the H200, "grew significantly in the quarter."

"Both Hopper and Blackwell systems have certain supply constraints, and the demand for Blackwell is expected to exceed supply for several quarters in fiscal 2026," Kress said.

Nvidia's gaming business reported $3.28 billion in revenue, versus StreetAccount expectations of $3.03 billion. Nvidia's graphics processing units were first developed for 3D gaming before the technology was repurposed for AI. Nvidia said the rise in sales was because of increased demand for GPUs for PCs and laptops, as well as an increase in game console chip revenue. Nvidia makes the chip at the heart of Nintendo's Switch.

The company's automotive and professional visualization businesses are much smaller than its data center and gaming segments. Automotive sales came in at $449 million, up 72% on an annual basis, which Nvidia said was due to self-driving car chips. The segment also includes chips that Nvidia sells for robots. The professional visualization segment accounted for $486 million in sales, up 17% year over year.

Huang was asked on the earnings call if potential tariffs placed under the Trump administration would affect Nvidia.

"Whatever the new administration decides, we will, of course, support the administration and the highest mandate," said Huang, adding that the company will "comply with any regulation that comes along fully."