EPS of $0.78 increased by 107.9% from previous year
Gross margin of 74.6%
Net income of 19.31B
""Revenue was up 94% year-on-year, driven by the sustained demand in our data center and AI platforms."" - Colette Kress
NVIDIA Corporation (NVDA) Q3 2025 Financial Results: Exceptional Growth Driven by Accelerated AI Adoption
Executive Summary
NVIDIA Corporation reported a remarkable Q3 2025, featuring a revenue increase of 94% year-over-year, driven by heightened demand for AI and accelerated computing solutions. Revenue reached $35.1 billion, surpassing management’s guidance significantly. The accelerated adoption of NVIDIA’s H200 products catalyzed a 112% year-on-year growth in the Data Center segment, manifesting NVIDIA's dominance in AI infrastructure. Gross and net margins remained robust, showcasing operational efficiency despite increasing R&D and operational costs.
Management emphasized the unprecedented growth trajectory for AI applications and their commitment to ramping production to meet soaring demand. The upcoming Blackwell architecture is expected to enhance performance capabilities further, which could result in sustained revenue growth in the current fiscal year and beyond, reinforcing NVIDIA’s competitive edge in the semiconductor industry.
Key Performance Indicators
Revenue
35.08B
QoQ: 16.78% | YoY:93.61%
Gross Profit
26.16B
74.56% margin
QoQ: 15.87% | YoY:95.19%
Operating Income
21.87B
QoQ: 17.31% | YoY:109.94%
Net Income
19.31B
QoQ: 16.33% | YoY:108.90%
EPS
0.79
QoQ: 16.18% | YoY:107.89%
Revenue Trend
Margin Analysis
Key Insights
**Revenue**: $35.1 billion, up 94% YoY, up 17% QoQ
### Year-over-Year and Quarter-over-Quarter Comparisons
- Revenue YoY Increase: 94%
- Operating Income YoY Increase: 109.9%
- Net Income YoY Increase: 108.9%
- Margin Analysis: Gross margin down from previous quarters due to increased production costs, but high demand ensures healthy margins.
Management attributed growth to the exceptional performance of their newly launched H200 systems and AI-driven services, with anticipation of further increases as they ramp up production of Blackwell systems in response to market needs.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
35.08B
93.61%
16.78%
Gross Profit
26.16B
95.19%
15.87%
Operating Income
21.87B
109.94%
17.31%
Net Income
19.31B
108.90%
16.33%
EPS
0.79
107.89%
16.18%
Key Financial Ratios
currentRatio
4.1
grossProfitMargin
74.6%
operatingProfitMargin
62.3%
netProfitMargin
55%
returnOnAssets
20.1%
returnOnEquity
29.3%
debtEquityRatio
0.16
operatingCashFlowPerShare
$0.72
freeCashFlowPerShare
$0.69
dividendPayoutRatio
1.27%
priceToBookRatio
52.31
priceEarningsRatio
44.63
Net Income vs. Revenue
Expense Breakdown
Management Commentary
### Key Insights from Management
- Data Center Growth: "Revenue of $30.8 billion was up 112% year-on-year. NVIDIA Hopper demand is exceptional and has set records across all platforms."
- AI Infrastructure Demand: "Our large installed base and rich software ecosystem encourage developers to optimize for NVIDIA and deliver continued performance and cost improvements."
- Future Innovations: "Blackwell demand is staggering, and we are racing to scale supply to meet the incredible demand customers are placing on us."
These insights indicate both a strong current performance and an aggressive push for future growth, particularly in AI and data centers, underscoring NVIDIA's critical role in the technology sector's evolution.
"Revenue was up 94% year-on-year, driven by the sustained demand in our data center and AI platforms."
— Colette Kress
"We expect Blackwell to significantly impact performance as we continue to ramp production and meet customer demand."
— Jensen Huang
Forward Guidance
### Forward Guidance
Management projects total revenue for Q4 2025 to be around $37.5 billion, underpinned by the acceleration of Blackwell products as they address rising demand across various sectors. The anticipated gross margin for Q4 is expected to moderate slightly to 73% to 73.5%. However, with the operational efficiencies achieved and continued expansions in emerging markets, management is optimistic about returning to mid-70s margins in the latter half of 2025. Investors are encouraged to monitor Blackwell's adoption rate and performance as a key indicator of future growth.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
NVDA Focus
74.56%
62.30%
29.30%
44.63%
INTC
15.00%
-68.20%
-16.70%
-1.54%
TSM
57.80%
47.50%
8.15%
21.97%
MRVL
23.00%
-46.40%
-5.06%
-27.13%
MU
26.90%
10.10%
0.75%
105.27%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Given NVIDIA's solid financial results and strategic positioning, the outlook for the company remains very promising. The significant growth in AI and data center solutions provides a robust platform for expansion, while the anticipated introduction of Blackwell technology is likely to enhance profitability. Investors should consider NVIDIA's long-term growth potential aligned with ongoing investments in AI infrastructure as critical to their investment thesis. Vigilance is advised regarding supply chain constraints and competitive landscape developments.
Key Investment Factors
Growth Potential
NVIDIA's growth is propelled by immense demand for AI-driven solutions and cloud services, having doubled revenue in the Data Center segment. With industry-leading technology and a substantial R&D pipeline, the growth trajectory appears robust. Blackwell could drive sustained revenue as it ramps up.
Profitability Risk
Risks include supply chain implications resulting from geopolitical tensions, particularly in China. Additionally, competition is increasing from rivals in semiconductor manufacturing, as well as potential regulations affecting export controls and market accessibility.
Financial Position
NVIDIA boasts a healthy balance sheet with $9.1 billion in cash and highly liquid investments totaling $38.5 billion. With total assets of $96.0 billion and low debt levels, the company is well-positioned to manage capital expenditures and return value to shareholders.
SWOT Analysis
Strengths
Strong brand recognition in AI and data center segments
Robust financial performance with significant year-over-year growth
Advanced technology in GPU and AI infrastructure
Large installed base and software ecosystem fostering customer loyalty
Weaknesses
Dependence on a limited number of high-margin products
Increased production costs impacting gross margins in the short term
Challenges related to supply chain and inventory management
Opportunities
Expanding market demand for AI technologies and solutions
Potential growth from emerging technologies and industries
Continued ramping of Blackwell systems
Threats
Intensifying competition from major semiconductor manufacturers
Geopolitical risks affecting supply chains, especially with relations in China
Market saturation risk in consumer electronics and gaming segments