Nvidia’s Stock Plunges Despite Earnings Beat

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Chipmaker Nvidia’s earnings for the second quarter of fiscal 2025 comfortably beat the analysts’ estimates. However, the market didn’t react in the expected way, with the company’s shares trading 7% down after hours of trading.

Nvidia’s Q2 results featured 68 cents in adjusted earnings per share and revenue of $30.04 billion versus 64 cents and $28.7 billion expected.

The company said it recorded growth across all of its divisions. Its data center business, which includes AI chips, saw a 154% increase in revenue. The gaming division, which was Nvidia’s forte prior to the AI boom, saw a 16% jump in revenue while its graphics business rose by 20%.

Finally, Nvidia said it expects revenue of $32.5 billion in the current quarter. This was enough to clear the mark of $31.7 billion set by analysts.

Nvidia also eased the concerns about its delayed Blackwell chip. The samples of the new generation AI chip have already been sent out, and Nvidia CFO Colette Kress expects “several billion dollars” in Blackwell revenue for its fourth fiscal quarter. Its current flagship chip, Hopper, also remains in great demand, with shipments expected to increase across the next two quarters.

Despite all the positives, Nvidia’s stock still plunged in the after-market. The stock closed at $125.61, being up 160% up year-to-date, before sliding down 7%. The reasons for the drop are not entirely clear at the moment, but the investors likely expected a bigger earnings beat than the one company delivered and believed the projections for the current quarter will get a more robust hike.

Ron B
Ron studied law but realized he’d much rather work in a profession that makes him happy and decided to become a writer. He now writes mostly about sports, business, stocks, and politics.