Things are looking up for Nvidia. The chipmaker reported better-than-expected earnings and revenue on Wednesday, as the company’s booming data center business recorded year-over-year growth of 73%.
Nvidia CEO Jensen Huang told investors on an earnings call that the $50 billion market in China for AI chips is “effectively closed to U.S. industry.”
Nvidia is still navigating the complications arising from the rising tensions between the United States and China, where President Donald Trump is still threatening massive tariffs against China. “The H20 export ban ended our Hopper data center business in China,” Huang said.
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The Nvidia H20 is a data center GPU based on the Hopper architecture, developed specifically for the Chinese market to comply with U.S. export restrictions. It offers AI acceleration capabilities for tasks like training large language models and high-performance computing, but with reduced performance compared to the H100. The H20 features limited interconnect bandwidth and scaled-down specs to meet regulatory requirements while still supporting modern AI workloads. Alongside other restricted models like the L20 and L2, the H20 allows Nvidia to maintain a presence in China’s AI sector despite export controls targeting advanced chip performance and interconnectivity for national security reasons.
The company also said its guidance would have been about $8 billion higher except for lost sales from a recent export restriction on its China-bound H20 chips.
However, despite export restrictions and other challenges, Nvidia boasted a revenue increase of 69% in the quarter from $26 billion a year earlier. The most notable growth the chipmaker observed was sales in the company’s data center division, which includes AI chips and related parts. The data center division reportedly grew 73% on an annual basis to $39.1 billion, accounting for 88% of total revenue.
Nvidia’s strong revenue growth signals its dominant position in the AI and data center markets. Despite facing export restrictions and geopolitical challenges, the company continues to outperform expectations, driven by global demand for its GPUs in artificial intelligence, cloud computing, and high-performance computing. This momentum reinforces Nvidia’s leadership in shaping the future of AI infrastructure. Its ability to adapt—through new product lines and strategic market shifts—shows resilience and innovation. Sustained growth not only boosts investor confidence but also positions Nvidia as a critical technology provider worldwide. If trends continue, the company is likely to maintain strong influence and profitability.