Artificial intelligence (AI) chip giant Nvidia says its revenue for the three months to the end of July more than doubled from a year earlier, reaching a record $30bn (£24.7bn).
However, the company’s shares fell more than 6% in New York following the announcement.
Nvidia has been one of the biggest beneficiaries of the AI boom, with its stock market value soaring to more than $3 trillion.
The company’s shares have risen more than 160% this year alone.
“It’s not just about beating estimates anymore, markets are expecting them to be beaten and it’s the magnitude of today’s beat that appears to have disappointed somewhat,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
The sky-high expectations are driven by its valuation, which has increased ninefold in less than two years thanks to its dominance in the AI chip market.
Profits for the period soared, with operating income rising 174% from the same period last year to $18.6 billion.
This is the seventh consecutive quarter in which Nvidia has exceeded analysts’ expectations for both sales and profits.
“Generative AI is going to revolutionize every industry,” said Nvidia CEO Jensen Huang.
The results have become a quarterly event that sends Wall Street into a frenzy of stock buying and selling.
A “watch party” was planned in Manhattan, according to the Wall Street Journal, while Mr. Huang, famous for his signature leather jacket, was dubbed the “Taylor Swift of technology”.
Alvin Nguyen, a senior analyst at Forrester, told the BBC that Nvidia and Mr Huang had become the “face of AI”.
That has helped the company so far, but it could also hurt its valuation if AI fails to deliver on its promise after companies invested billions of dollars in the technology, Nguyen said.
“A thousand AI use cases is not enough. You need a million.”
Mr. Nguyen also said that Nvidia’s first-mover advantage means it has market-leading products that its customers have used for decades and that it has a “software ecosystem.”
He said competitors like Intel could “eat away” at Nvidia’s market share if they developed a better product, although he said that would take time.
