Nvidia Sales Surge
Nvidia Forecasts Chip Sales Doubling Amid Strong Growth and High Demand
Anonymous
Key Points
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Nvidia’s $7.9 billion in China billings represented about 8% of total revenue and nearly doubled from $4.0 billion a year earlier, but the increase was concentrated in products such as gaming and workstation chips rather than AI-compute hardware.
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Nvidia’s China outlook could be affected by planned U.S.-China diplomacy: President Donald Trump and Chinese President Xi Jinping were scheduled to discuss artificial intelligence at a Sept. 24 White House meeting, with Jensen Huang reportedly expected to attend the accompanying state dinner.
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Nvidia’s projected fiscal 2028 revenue of roughly $673 billion reflects about 70% annual growth, while management has indicated revenue could potentially double if the company had enough supply to meet demand.
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The comparison between doubling chip sales and doubling revenue is complicated by Nvidia’s broad product portfolio and varying prices, which spans Blackwell and Rubin data-center GPUs, CPUs, networking and optical chips, laptop and robotics processors, vehicle chips, and the processor used in Nintendo’s Switch 2.
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The restrictions squeezing Nvidia’s China business resulted from actions by both governments: U.S. export controls were followed by Chinese limits on purchases of certain U.S.-made chips, after Nvidia’s earlier effort to sell downgraded China-specific products was also undermined by subsequent restrictions.
Nvidia is on track to double its chip sales next year as artificial intelligence investment surges globally, Globe and Mail reported. The chip maker posted $96.2 billion in quarterly revenue, up 106% year over year, and forecast $108 billion for the next quarter — assuming zero revenue from China's restricted AI-chip market. Chief Executive Jensen Huang said the company could sell twice as many chips annually, though that growth won't necessarily translate to matching revenue gains due to varying product prices and portfolios.
Nvidia's projection for roughly 70% annual revenue growth through fiscal 2028 points to potential sales of $673 billion, NASDAQ noted. Data-center sales hit $89 billion this quarter, driving most growth. But the company faces critical supply challenges: it must expand advanced memory production, manufacturing capacity, and packaging while transitioning from its Blackwell chip platform to the next-generation Vera Rubin.
China Market Remains Effectively Closed to AI Chips
Nvidia earned $7.9 billion from China in the latest quarter — nearly double the $4.0 billion a year earlier — but this growth came almost entirely from gaming and workstation products, not AI hardware. U.S. export controls have blocked Nvidia from selling its most advanced data-center chips to China. Chinese purchasing restrictions have further tightened the noose. Yahoo Finance reported that Nvidia is forecasting zero data-center compute revenue from China for the next quarter, a sharp reversal for a market that once generated substantial sales.
The restrictions stem from competing government actions. The U.S. imposed export controls first. China then limited purchases of certain American chips in response. When Nvidia tried selling downgraded China-specific products, subsequent U.S. restrictions blocked that strategy too. The result: Nvidia's China billings now represent only about 8% of total revenue.
Chip Supply Constraints Will Determine Growth Success
Doubling chip unit sales does not equal doubling revenue or profit. Nvidia's product lineup spans Blackwell and Vera Rubin data-center GPUs, CPUs, networking chips, optical components, laptop processors, robotics chips, vehicle processors, and even the chip powering Nintendo's Switch 2. Prices vary widely across these products. Hitting the sales-doubling target will require solving supply bottlenecks in advanced memory, manufacturing capacity, and chip packaging — challenges that could limit actual delivery even if demand exists.
U.S.-China Diplomacy Could Shift China Business Outlook
President Donald Trump and Chinese President Xi Jinping are scheduled to meet on September 24 at the White House to discuss artificial intelligence, Globe and Mail reported. CEO Jensen Huang was reportedly expected to attend the accompanying state dinner. Any shift in U.S.-China AI policy or export restrictions could materially change Nvidia's China revenue forecast — potentially unlocking billions in previously unavailable data-center chip sales.
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