CEO Jensen Huang concedes China AI chip market to Huawei as analysts flag slowing growth ahead
Nvidia posted record first-quarter fiscal 2027 revenue of US$44.06bn, yet its shares fell roughly 1.6 percent in after-hours trading Wednesday.
The decline follows a pattern that has played out after each of the company's last three earnings reports, CNBC reported.
The result cleared Wall Street estimates by a wide margin.
Revenue surged 85 percent year over year, according to Nvidia, while adjusted earnings per share came in at US$1.87 against analyst estimates of US$1.76.
Data centre revenue reached US$75.2bn, up 92 percent from a year earlier.
Net income rose to US$58.32bn, BNN Bloomberg reported.
Nvidia forecast second-quarter revenue of about US$91bn, well above the Wall Street consensus of roughly US$86.84bn, according to LSEG data cited by Reuters.
The figure fell short of the most bullish projections, the Financial Times noted.
The muted reception drew commentary from analysts tracking the stock's trajectory.
Daniel Newman, chief executive of The Futurum Group, told the FT that Nvidia is starting to resemble a mature technology holding.
"Nvidia starts to become more like an Apple," he said. "A safe place to invest."
Investors chasing outsized returns, he added, are looking at other AI players with more growth potential.
Visible Alpha's Melissa Otto told the FT that revenue growth is expected to slow to about 36 percent next fiscal year, saying "those years of the massive upwards revisions may be behind Nvidia now."
Nvidia is now one of the largest US dividend payers at roughly US$24bn annually, the FT reported, after its board approved an additional US$80bn share repurchase programme and raised its quarterly dividend from US$0.01 to US$0.25 per share on May 18.
The company also returned approximately US$20bn to shareholders in the quarter through buybacks and dividends.
Chief financial officer Colette Kress told analysts the moves reflected "confidence in our long-term free cash flow outlook."
CEO Jensen Huang told analysts that Nvidia's new "Vera" central processors open a fresh US$200bn market, Reuters reported.
The company expects US$20bn in Vera chip revenue by fiscal year-end, a figure not included in its earlier US$1tn estimate covering Blackwell and Rubin chips through 2027.
Huang also said he expects Nvidia to grow faster than its largest cloud customers' capital spending.
"We should be growing faster than hyperscale capex," he said, according to Reuters.
For the first time, the Financial Times reported, Nvidia disclosed that data centre revenue comes roughly equally from hyperscalers and a faster-growing second tier of clients, including AI-native clouds, enterprise customers, and sovereign AI programmes.
On China, Huang told CNBC the company had "largely conceded" that market to Huawei following tightening US export restrictions.
Huang said demand in China is "quite large" and that Huawei is "very, very strong," adding that local chip companies are thriving because Nvidia has "evacuated that market."
He struck a cautious tone on any near-term reopening, telling investors to "expect nothing" on approvals to sell advanced chips into the country.
During Trump's state visit to China last week, Beijing banned imports of Nvidia's China-specific RTX 5090D V2 gaming chip, the Financial Times reported.
