Has the AI bubble got too big? Nvidia reports Q2 results

Has the AI bubble got too big? Nvidia reports Q2 results
Published  
August 28, 2025

No blockbuster, Nvidia’s Q2 earnings landed in line with expectations. But at $46.7 billion in revenue, up 56% year-on-year and 6% sequentially, this is what steady looks like when you’re the largest company in the world. If you’re worrying there is an AI bubble, these figures will not assuage concerns. Nvidia remains top dog of AI infrastructure spend and slowing growth could spell trouble ahead.

The company’s data centre division again did much of the heavy lifting, delivering $41.1 billion of revenue, also up 56% year-on-year. Gamers contributed 16%, the automotive sector 37%. Hefty gross margins at 75.1%, but slipping 3 points quarter-over-quarter. Adjusted EPS was $1.05, narrowly beating expectations.

Operating income surged to $18.6 billion, up 174% year-on-year, and Nvidia unveiled that they were increasing their share buyback programme to $60 billion from a previously announced $50 billion. 

Nvidia booked $180m in H20 chip sales outside China, but with sales to China itself at zero, that figure barely dents the hole left by lost access to the world’s second-largest AI market.

But CEO Jensen Huang said: “China represents a $50 billion opportunity for us, and we see a real possibility that we could win approval to sell Blackwell chips in that market.”

There’s something for investors to consider that a single company can have such an outsized impact on the market. Nvidia is the poster child for a MAG7-overweighted, frothy market. Nvidia is like AI’s ballooning bellwether. 

When market sentiment appears to be hanging on the results of a single company - however large it may be - investors would always be wise to ask themselves if this indicates strength or weakness ahead. 

2020 2021 2022 2023 2024 YTD 2025
Nvidia +117.7% +125.3% -50.3% +238.9% +171.2% +35.2%

Share price return for Nvidia. Source: Refinitiv.

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