Nvidia fails to impress investors with blockbuster results, as AI adoption ‘skyrockets’ – business live | Business

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What’s a tech firm gotta do to get a share price bump these days?

Nvidia may be asking that question after reporting strong earnings last night, alongside a solid growth forecast, only to receive a shrug from Wall Street.

The chip-making firm certainly had another extremely strong quarter – it posted record quarterly revenue of $68.1bn for October-December 2025, up 20% compared with the third quarter of last year and a sizzling 73% more than a year earlier.

The company said sales were being driven by accelerated computing and AI, with customers scrambling to get their hands on its high-powered Blackwell chip.

Jensen Huang, founder and CEO of Nvidia, told investors that take-up of AI agents by companies was accelerating:

“Enterprise adoption of agents is skyrocketing. Our customers are racing to invest in AI compute — the factories powering the AI industrial revolution and their future growth.”

Nvidia also predicted another jump in sales in the current quarter, when revenue is expected to rise to $78.0bn, beating forecasts.

But while its shares did briefly rally in after-hours trading when the results hit the wires, this didn’t last – the stock then turned negative, and finally finished just 0.2% higher.

As Jim Reid of Deutsche Bank puts it:

The initially positive reaction faded as the company’s conference call offered limited detail on the revenue outlook, leaving the chipmaker’s shares little changed by the end of extended trading. So perhaps a sign of investors’ increased anxiety over AI valuations.

Nvidia’s problem is partly that its share are already ‘priced for perfection’ – up 1,300% over the last five years. So even stellar sales growth is already priced in.

Also, these results landed in a market where investors are fretting that AI will drive up white-collar unemployment, take business away from software-as-a-service companies, payment providers and travel and estate agencies, and trigger a mortgage crash.

Kathleen Brooks, research director at XTB, says there are a few factors behind the muted reaction to what she calls “Nvidia’s A* earnings report”:

Nvidia and the semiconductor space has outperformed the broader tech sector so far this year. Nvidia’s results suggest that demand for AI is strong, and fears of an AI bubble are overdone. Thus, investors could pile into the less loved parts of tech, for example software, before going headfirst into Nvidia. The Nasdaq e-mini contract is higher by 1.4% after Nvidia’s earnings report.

Secondly, this report did not generate much reason for disappointment, but even so, some investors may have hoped that CEO Jensen Huang would boost sales pipeline estimates for this year above $500bn. Huang was also asked about hyperscalers’ and their future capex plans now that there was some pressure on their cash flows. This did not bother Huang, but it could sow a seed of doubt in the mind of investors.

Overall, the initial reaction to Nvidia’s results suggest that investors are still unwilling to chase a higher trend in tech stocks right now, even after Nvidia’s stunning earnings report. This report will likely be pored over in detail on Thursday, but for now it is not driving a significant rally in the share price.

The agenda

• 8.30am GMT: Christine Lagarde testifies to the Committee on Economic and Monetary Affairs (ECON) of the European Parliament

• 9.30am GMT: UK’s ONS publishes latest quarterly NEETs data

• 1.30pm GMT: US weekly jobless claims