Nvidia shares jump 6% in after-hours trading as chip designer earnings deliver on AI promise

Nvidia under intense scrutiny on concerns of some analysts the stock market bubble around AI-linked shares was about to burst

Nvidia chief executive Jensen Huang.

US chipmaker Nvidia, which has been at the heart of the frenzy around artificial intelligence that has helped fuel a remarkable rally for global stock markets, posted quarterly earnings that beat analyst expectations. Its shares jumped more than 6% in after-hours trading on Wednesday night.  

The latest earnings of Nvidia have come under intense scrutiny on concerns of some analysts that the stock market bubble around AI-linked shares was about to burst. 

The company nonetheless forecast current-quarter revenue of $24bn (€22.19bn). Analysts on average were expecting revenue of $22.17bn. 

As a leading member of the so-called Magnificent 7 group of stocks, which includes Microsoft, Apple, Amazon and Google-owner Alphabet, the US chipmaker is at the centre of the AI frenzy.

The products it is designing will likely be used by data centres around the world and are set to take on even greater volumes of business as AI tools are rolled out across global economies.   

A 225% surge in its share price this year helped Nvidia replace Alphabet as the third most valuable US company, behind Microsoft and Apple, and was valued by stock markets at $1.65trn ahead of the results on Wednesday night. 

Nvidia is the last of the Magnificent 7 companies to report earnings in this cycle. 

The earnings of the tech giants that reported in recent weeks have had something of a mixed reception. 

After huge gains last year, Amazon shares are 8% higher in the past month, Microsoft shares are little changed, while Alphabet and Apple have fallen by 3% and 5%, respectively.