Nvidia Q1 results surpass Wall Street expectations thanks to massive AI chip demand

Artificial intelligence (AI) chipmaker Nvidia's quarterly results surpassed Wall Street's expectations once again, fuelled by massive demand for its high-end AI chips.

The company said on Wednesday it earned US$58.32 billion, or US$2.39 per share, in the February-April period, up from US$18.78 billion, or 76 cents per share, in the same period a year earlier. Excluding one-time items, Nvidia earned US$1.76 per share.

Revenue jumped 85 per cent to US$81.62 billion from US$44.01 billion.

Analysts, on average, were expecting earnings of US$1.75 per share and revenue of US$78.91 billion, according to a poll by FactSet. Nvidia's results have exceeded the analyst projections that shape investors' perceptions since Nvidia's high-end chips emerged as AI's best building blocks three years ago.

"The buildout of AI factories — the largest infrastructure expansion in human history — is accelerating at extraordinary speed," said CEO Jensen Huang in a statement.

Along with higher profit and revenue, however, Nvidia's operating expenses increased by 49 per cent to US$7.75 billion.

For the current quarter, Nvidia forecast revenue of about US$91 billion. Analysts are forecasting US$87.29 billion.

Despite the solid results and outlook, many investors still evidently are worried about a comedown after a three-year boom that has seen Nvidia's market value soar from US$400 billion at the end of 2022 to US$5.4 trillion as of Wednesday.

Shares of the Santa Clara, California-based company dipped slightly after hours to US$222.12, after closing at US$223.47 in the regular trading session.

"Time and time again, [Nvidia] obliterates expectations and consensus; it delivered exactly on what people wanted, especially regarding data centres," said David Wagner, head of equity and portfolio manager at Aptus Capital Advisors. "But the market doesn't always act as you would expect after a strong report like this one."

The company also announced plans to return some money to shareholders. It authorised a plan to buy back US$80 billion worth of stock and increased its quarterly cash dividend to US$0.25 per share from US$0.01.

-AP