Nvidia has posted another massive growth in its datacentre business, but its CEO is eager to sell the company’s high-end Blackwell chip to China.
Nvidia posted revenue of $46.7bn in its latest quarterly filing for the second quarter to 27 July, representing a 56% increase from last year. Nvidia said Blackwell datacentre revenue grew by 17% sequentially. However, the company said it had not assumed any shipments of the H20 device to China in its outlook.
“Blackwell is the AI [artificial intelligence] platform the world has been waiting for, delivering an exceptional generational leap – production of Blackwell Ultra is ramping at full speed and demand is extraordinary,” said Jensen Huang, founder and CEO of Nvidia. “Nvidia NVLink rack-scale computing is revolutionary, arriving just in time as reasoning AI models drive orders-of-magnitude increases in training and inference performance. The AI race is on, and Blackwell is the platform at its centre.”
Forrester senior analyst Alvin Nguyen noted that interest in state-of-the-art products, such as Blackwell, remains high. “The company is making strategic moves across areas under their control, including continued development of state-of-the-art datacentre GPUs [graphics processing units], innovation in new growth areas like robotics and physical AI, and promoting use cases that drive increased GPU purchases, such as reasoning AI and rack-scale computing,” he said.
Responding to a question during the earnings call regarding China, Huang said: “China is the second largest computing market in the world and the home of AI researchers.” According to Huang, about 50% of the world’s AI researchers are in China. He estimated the China opportunity to be worth $50bn to Nvidia. “It’s fairly important for American technology companies to be able to address that market.
Earlier this month, the US administration said it would allow Nvidia to sell chips to the Chinese market. This is part of a deal that would see the previous export restrictions overturned in favour of companies giving the US government 15% of sales revenue. It is believed that the deal does not include Nvidia’s Blackwell chip.
While the Trump administration has imposed export restrictions on sales of high-end graphics processor units and AI acceleration hardware to China, Huang sees an opportunity to bring its Blackwell AI accelerator technology to the Chinese market.
“We’re talking to the administration about the importance of American companies to be able to address the Chinese market,” he said.
Discussing the issues Nvidia is facing regarding China, Kate Leaman, chief market analyst at AvaTrade, said: “Nvidia didn’t ship any of its H20 chips to China this quarter. Export restrictions are biting. Management said if those rules ease, it could add $2bn to $5bn in sales next quarter. But that’s a big ‘if’ – markets don’t like uncertainty, especially with geopolitics in the mix.”
Leaman said Nvidia’s results support the idea that AI infrastructure is the next long-term growth engine. “It’s good news for chipmakers, cloud providers and even more speculative AI plays. This is a rising tide moment,” she added.
However, as Leaman noted, China’s situation is a reminder that no matter how strong a company is, macro forces still matter. “Regulation, trade tensions and global politics are now part of the equation,” she said.
