Nvidia continues to expand as demand for artificial intelligence rises, despite political challenges between the United States and China.
On Wednesday, the chipmaker reported revenue of $46.7bn (£34.6bn) for the second quarter, up 56% from the same period in 2024.
Shares slipped in after-hours trading after the company admitted it was still “working through geopolitical issues”. Nvidia remains caught in a trade dispute between Washington and Beijing.
Fast-changing policies from the Trump administration, aimed at keeping America ahead in artificial intelligence, create additional uncertainty for the company.
Growing demand for chips
Nvidia’s advanced processors remain central to the artificial intelligence race.
The company reported strong demand from major technology firms including Meta, the parent of Instagram, and OpenAI, the developer of ChatGPT. These companies continue to expand their AI systems at high speed.
“The AI race is now on,” said Nvidia chief Jensen Huang in a call with analysts. He explained that four large technology companies had doubled their annual spending to $600bn.
“Over time, artificial intelligence will accelerate GDP growth,” Huang added. “Our role is to provide the infrastructure making that possible.”
Experts highlighted Nvidia’s dominant role in this market. Colleen McHugh, chief investment officer at Wealthify, called the company “the driving force behind the AI boom”.
She said Nvidia has little competition in AI chips and depends on continued investment from technology giants. That spending, she noted, should keep returns and the share price climbing.
Revenue from data centres increased by 56% to $41.1bn, although slightly below forecasts. Investor Eileen Burbridge, founding partner of Passion Capital, said the “share price wobble” followed weaker-than-expected performance in this division.
Even so, she described Nvidia’s growth as “unbelievable” but warned of excessive excitement creating a potential bubble.
In July, Nvidia became the world’s first $4trn company. The firm now expects revenue of $54bn for the current quarter, above Wall Street predictions.
Geopolitics weigh on growth
Despite historic gains, Nvidia continues to face political obstacles.
In July, the company announced it would restart sales of its high-end AI chips to China. The decision followed lobbying by Huang, which persuaded the Trump administration to reverse its ban on the H20 chip, designed for Chinese buyers.
The ban had been imposed over fears that the chips could benefit China’s military as well as local AI firms.
Executives confirmed that at the end of July, US authorities began reviewing licenses for the H20. Some Chinese customers have received approval, but Nvidia has not shipped any chips.
The US government expects to take 15% of revenue from licensed H20 sales. Nvidia excluded the H20 from its forecast and continues pressing for approval to sell its Blackwell chips in China, the world’s biggest chip market.
Meanwhile, Beijing is accelerating efforts to build its domestic chip sector. “US export restrictions are fuelling Chinese chipmaking,” said Emarketer analyst Jacob Bourne.
He added that Nvidia’s future may depend on whether its push into robotics helps it remain “the bellwether of the AI economy”.
