NVIDIA implemented a design modification (mask change) to Blackwell GPUs, contributing to weaker-than-expected forward guidance.
NVIDIA Corporation beat analyst revenue and guidance estimates in its results for the second quarter of the fiscal year 2025. The firm posted $30 billion in revenue, representing 122% annual growth, along with $16.9 billion in non-GAAP net income for 152% annual growth. Most notably, NVIDIA guided $32.5 billion in revenue for its third quarter of the fiscal year 2025, surpassing LSEG revenue guidance estimates of $31.77 billion by roughly $700 million.
The stock's immediate reaction was volatile. NVIDIA's shares initially dropped by 9.24% before jumping by 5.28%, resulting in an overall decline of 2.62% at 4:28 p.m. Eastern Time. A key concern heading into the earnings release centered on NVIDIA's Blackwell GPU lineup, as market participants had been tracking reports of design-related delays. CEO Jensen Huang addressed this directly in the firm's prepared remarks, noting that demand for the Hopper GPU lineup "remains strong" and that "anticipation" for Blackwell is "incredible." Huang stated that "samples are shipping to our partners and customers."
CFO Collette Kress provided further clarity on Blackwell in her remarks. She noted that customers "continue to accelerate their Hopper architecture purchases while gearing up to adopt Blackwell," and acknowledged that NVIDIA "executed a change to the Blackwell GPU mask to improve production yield." While Blackwell customer samples shipped during the second quarter, the GPU's production ramp "is scheduled to begin in the fourth quarter and continue into fiscal 2026," according to the CFO. NVIDIA expects "to ship several billion dollars in Blackwell revenue" in its fourth quarter, which ends in late January.
On the financial side, NVIDIA's receivables doubled year-over-year to $14.1 billion, compared to $7 billion in the year ago quarter, and grew from $12.4 billion in the prior quarter. The company approved a $50 billion share repurchase program and maintained a $0.01 quarterly dividend per share. By 4:52 p.m. ET, the stock was down 4.57% in aftermarket trading.