Nvidia Reports Strong Earnings, Faces Margin Pressure Amid Blackwell Chip Rollout

The AI chip leader posted significant revenue growth but signaled tighter profit margins due to the high costs of its new Blackwell processors.

Nvidia reported a 78% year-over-year revenue increase for its fourth quarter, totaling $39.3 billion, driven by strong data center and AI demand.
The company's new Blackwell processors generated $11 billion in revenue during their first quarter on the market, exceeding expectations.
Profit margins are expected to dip to 71% in the current quarter due to the costly ramp-up of Blackwell production, though Nvidia aims to restore margins to mid-70% later this fiscal year.
Analysts remain optimistic about Nvidia's long-term growth, citing robust AI demand and significant investments from major tech firms like Microsoft, Meta, and Amazon.
Despite the earnings beat, Nvidia's stock reaction was muted, reflecting investor concerns over narrowing margins and the high bar for continued performance.