The solid prognosis of Nvidia growth for the first quarter pointed out that the growing demand for its artificial intelligence chips remains intact, and the company said that the orders of its new Blackwell semiconductors are “amazing.”
This Wednesday’s prognosis of the company helps to dissipate doubts about a possible slowdown in the expense in its hardware, which emerged last month after the Chinese Deepseek startup claimed to have developed artificial intelligence models that rival their western counterparts at a fraction of the cost.
Their actions rose before falling slightly into an agitated session after closing with a 3.7% rise in the regular session. Nvidia is the biggest beneficiary of a rebound in the actions related to artificial intelligence, with its titles up more than 400% in the last two years.
CEO Jensen Huang adopted an optimistic tone by stating that “artificial intelligence is moving at the speed of light” and that “Blackwell’s demand is amazing”, in comments that should be favorable for AI -related actions, which have suffered falls in the last week.
“We have successfully climbing the mass production of the Blackwell supercomputers, achieving billions of dollars in sales in their first quarter,” he said.
Nvidia is going through a critical product transition while adopting a new chips architecture called Blackwell, going from selling individual chips to complete artificial intelligence computing systems that make up graphic chips, processors and network equipment.
The company based in Santa Clara, California generated 11,000 million dollars in revenues from products related to Blackwell in the fourth quarter of 2024, which represents approximately 50% of the total income of its data centers segment.
Nvidia expects total income of 43,000 million dollars, with a margin of error of 2%, for the first quarter of 2025, compared to the average estimate of analysts of 41,780 million dollars, according to LSE.
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“Unlike the previous quarters, there was elevated skepticism before this report due to concerns about the efficient Depseek model and questions about the launch of Blackwell,” said Jacob Bourne, an emarketer analyst. “But the results have dissipated doubts.”
However, Blackwell’s expansion has been complicated and expensive, affecting the company’s margins.
On Wednesday, Nvidia projected that the gross margin for the first quarter would be slightly below expectations: it would be reduced to 71%, below 72.2% forecast by Wall Street, according to data compiled by LSE.
However, Nvidia’s financial director, Colette Kress, said at a telephone conference that the company would return to the average 70% range in gross margin later in the fiscal year, as the production of its Blackwell chips increases and reduces costs.
The rise of artificial intelligence lost some impulse last month after the sudden appearance of Deepseek, which turned out that Nvidia lost 593,000 million dollars in market value, the largest loss in a single day for any US company.
Investors questioned whether the demand for artificial intelligence chips was sustainable and the huge capital expenses promised by large US technology companies, including Microsoft.
Microsoft has allocated 80,000 million dollars for artificial intelligence in its current fiscal year, while Meta Platforms has promised up to 65,000 million dollars.
A recent brokerage report suggested that Microsoft has canceled leases for a significant capacity of data centers in the US, which suggests a possible excess offer. But Reuters on Monday reported that Chinese companies are increasing the orders of the NVIDIA H20 chip due to the growing demand for the low -cost artificial intelligence model of Deepseek.
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“Despite Deepseek’s advances, Nvidia’s impulse with Hyperscalers seems to continue,” said Lucas Keh, an analyst at Third Bridge, in reference to large cloud computing companies.
In positive news for NVIDIA, Financial Director Kress said that the Stargate Data Center project, announced last month by Donald Trump will use the NVIDIA Spectrum X Ethernet X for Networks. Ethernet products are included in the company’s data centers segment.
Nvidia reported a gain adjusted by 89 cents, compared to estimates of 84 cents per action.
The revenues of the fourth quarter grew 78% to 39.3 billion dollars, exceeding the estimates of 38,040 million dollars.
Sales in the data centers segment, which represents most of Nvidia’s revenues, grew 93% to 35.6 billion dollars in the quarter ending on January 26, above the estimates of 33,590 million dollars. The segment had registered a 112% growth in the previous quarter.
With Reuters information
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