Nvidia’s fourth-quarter earnings for fiscal year 2025 surpassed Wall Street estimates, reinforcing strong demand for artificial intelligence (AI) technology. However, the company’s revenue growth showed signs of slowing, raising concerns that the peak of the AI boom may have passed.
Nvidia reported record-high revenue of $39.3 billion (€37.5 billion), reflecting a 78% year-on-year increase. Despite exceeding analyst projections, this marks the slowest growth rate since early 2023. The company’s stock initially climbed nearly 3% following the earnings announcement but later dipped over 1% in after-hours trading.
AI Boom Losing Steam?
Since 2023, Nvidia has been the dominant player in the AI revolution, with its high-performance Graphics Processing Units (GPUs) driving industry-wide innovation. Its market valuation recently surpassed $3 trillion (€2.86 trillion), making it the second-largest publicly traded company after Apple. However, the latest figures suggest that Nvidia’s meteoric rise may be slowing, at least temporarily.
The company’s data center segment remains its strongest revenue driver, hitting a new record of $35.6 billion (€34 billion) in Q4—up 93% year-over-year. However, this is the first time since mid-2024 that growth in the division fell below 100%. The full-year revenue for data centers soared 142% to $115.2 billion (€110 billion), reflecting continued investment from hyperscalers and cloud service providers.
Nvidia’s CEO, Jensen Huang, highlighted the success of the company’s latest AI chip, Blackwell, describing it as the “fastest product ramp in our company’s history.” Blackwell contributed significantly to Nvidia’s sales, accounting for 50% of its data center revenue. Huang emphasized that demand for Blackwell remains strong, as AI models continue to require increasing computational power.
Market Uncertainty and Competitive Pressures
Despite strong financial performance, Nvidia faces broader market challenges. A recent shift in investor sentiment has seen funds rotating out of U.S. tech stocks, impacting market valuations. Additionally, competition from Chinese AI firms, such as DeepSeek, which offers cost-effective AI models, has led to concerns about Nvidia’s long-term dominance.
Another factor under scrutiny is whether major tech companies will sustain their high levels of AI infrastructure investment. Microsoft recently signaled plans to slow capital expenditures, which could impact Nvidia’s future growth trajectory.
“Nvidia is the bellwether for AI demand, and this result will once again alleviate the naysayers,” noted Josh Gilbert, a market analyst at eToro Australia.
Revenue Outlook and Growth Projections
Looking ahead, Nvidia has projected revenue of $43 billion (€41 billion) for the current quarter, representing a 65% year-on-year increase. While this forecast surpasses analyst expectations, it suggests continued deceleration in growth. Additionally, the company expects its gross margin to decline to between 70.6% and 71%, reflecting increased spending on new product development.
Meanwhile, Nvidia’s gaming and AI PC segment recorded a revenue decline of 11% year-on-year to $2.5 billion (€2.4 billion). Despite this drop, the segment only represents 6% of the company’s total revenue and had little impact on overall financial performance.
As the AI market evolves, Nvidia remains a key player in the industry. However, with revenue growth slowing and competition increasing, investors will be closely watching the company’s next moves to sustain its dominance in the AI sector.
