4 key takeaways from Nvidia’s earnings call

According to Nvidia (NVDA) posted better-than-expected quarterly results, CEO Jensen Huang and CFO Colette Kress gave investors an update on the strength of demand for the company’s artificial intelligence (AI) chips, plans for its Blackwell shipments and more in the company’s earnings call.

Cloud providers help drive data center sales to record highs

Nvidia’s data center sales doubled in the second quarter from a year earlier, hitting a record high.

CFO Colette Kress said about 45 percent of data center sales were from cloud service providers, while consumer, Internet and business customers accounted for half of data center revenue.

The increase in data center sales comes as many tech giants ramp up spending on AI, with the breakdown providing some insight into the state of AI demand. Major Microsoft cloud providers (MSFT), Google’s parent Alphabet (GOOGLE), and Amazon (AMZN) all said they expect AI infrastructure spending to increase, particularly data centers, and all are Nvidia customers.

Nvidia says Blackwell will be a ‘game changer’

CEO Jensen Huang also said that Nvidia expects its data center business to grow “quite significantly next year,” adding that “Blackwell will be a complete industry changer.”

Huang previously said he expected Nvidia’s Blackwell platform to be “the most successful product” in the company’s history, with analysts calling it “Silicon Valley’s most ambitious project” after it was unveiled in March.

Blackwell plans still on track, with demand outstripping supply

Amid fears that Nvidia’s Blackwell shipments could be delayed, Kress said Nvidia expects “several billion dollars” from Blackwell sales as production ramps up in the fourth quarter.

Demand for Blackwell also remains “far outstripping supply,” Kress said, adding that Nvidia expects that to continue next year.

Strong demand for Hopper ahead of Blackwell deliveries

Asked about demand for Hopper, Blackwell’s predecessor, Huang said demand remains strong because many of Nvidia’s customers “simply can’t afford” to wait for new AI chips.

Huang said that because of the dynamic nature of the generative AI market and the potential consequences of waiting when companies have the opportunity to build advanced computing infrastructure with Hopper earlier, “this decision is relatively clear.”

Shares of Nvidia fell nearly 7% in extended trading on Wednesday after the company’s earnings call, as its results may not have been enough to meet investors’ high expectations.

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