AI powerhouse Nvidia reported its second quarterly earnings on Wednesday that showed a profit of $26.4 billion on record revenue of $46.7 billion, significantly beating investor expectations. Yet, the company’s shares slipped more than 3 per cent in after-market trading amid concerns about whether the massive AI bubble is set to burst.
Nvidia’s revenue may have increased year-on-year, but its Data Centre revenue declined 1 per cent from the previous quarter, driven mostly by a decrease in sales of H20 chips-specialised processors to China that set the firm back by $4 billion.
The US-headquartered AI giant is considered a bellwether for the AI market since it became the first company to reach $4 trillion last July. However, investors have begun questioning whether the huge AI investments are sustainable.
Earlier this month, US President Donald Trump confirmed that Nvidia would pay the US government 15 per cent of its revenue from sales of specific AI chips to China. Beijing, meanwhile, expressed national security concerns about the company’s chips and started ramping-up domestic chipmaking.
Also Read: Nvidia CEO in talks with Trump admin on new chip for China
Wednesday’s after-market trading also showed decline in oil prices and mixed US futures.
In China, meanwhile, shares in computer chip maker Cambricon Technologies surged 7.1 per cent to 1,469.99 Yuan (USD 205.60), becoming the priciest stock on Shanghai's exchange as it surpassed Kweichou Moutai's stock, which was unchanged at 1,449 Yuan (USD 202.51) a share.
With China scaling up its domestic chip-making and semiconductor market, Cambricon's shares have jumped after it reported its revenue and profit soared in the first half of the year.
The Shanghai Composite index edged less than 0.1 per cent higher to 3,803.08; it has been trading near decade-high levels on heavy buying by institutional investors.
Asian shares, on the other hand, were mixed in early trade dealings on Thursday after modest gains on Wall Street lifted the S&P 500 to another all-time high as investors anticipated record profits in Nvidia quarter earnings.
Hong Kong's Hang Seng dropped 0.7 per cent to 25,035.78, led by losses for technology companies like food delivery company Meituan, whose shares dropped 10.3 per cent, while e-commerce giant JD.com declined 3.5 per cent. Chinese consumers have cut back on spending, showing a lag in demand for e-commerce companies.
Japan's Nikkei 225 added 0.6 per cent to 42,755.61, continuing its upward trajectory even as top trade envoy Ryohei Akazawa abruptly postponed a trip to the US capital planned for Thursday in the latest sign of trouble over the deal-setting tariffs on Japanese exports at 15 per cent, a policy that has yet to come into effect.
South Korea's Kospi climbed 0.4 per cent to 3,200.71 after the Bank of Korea kept its policy rate unchanged at 2.5 per cent for its second straight meeting.
Australia's S&P/ASX 200 edged 0.1 per cent higher to 8,970.30 and Taiwan's TAIEX shed 0.7 per cent.
Also Read: Trump tariffs drag Markets down by 1 pc
Stock indexes in Jakarta and Kuala Lumpur were both 0.4 per cent higher, while that in Manila was down 0.5 per cent near midday.
The Dow Jones Industrial Average rose 0.3 per cent to 45,565.23, and the Nasdaq composite closed 0.2 per cent higher at 21,590.14.
Technology companies led the way higher, outweighing declines in communication services and other sectors.
Wall Street has been subdued since Trump escalated his fight with the Federal Reserve by trying to fire central bank Governor, Lisa Cook. Cook's lawyer said she'll sue Trump's administration to try to stop him.
Trump has been at loggerheads with the central bank over its cautious interest rate policy. The Fed has held rates steady since late 2024 over worries that Trump's unpredictable tariff policies will reignite inflation.
In other dealings early Thursday, US benchmark crude dropped 52 cents to USD 63.63 per barrel. Brent crude, the international standard, declined 49 cents to USD 66.95 per barrel.
The dollar fell to 147.19 Japanese yen early Thursday, down from 147.40 yen. The euro rose to USD 1.1641 from USD 1.1640.
India's BSE Sensex fell 1.1 per cent after reopening following a public holiday, registering a somber mood as higher US tariffs on its exports took effect on Wednesday.
Textile, leather, gems and jewellery stocks declined on Thursday morning trade, being sectors that will be hit hardest by Trump’s 50 per cent tariffs which are expected to impact exports worth more than $48 billion.
Shares of Alok Industries tanked 4.13 per cent, Raymond Lifestyle fell by 3.66 per cent, Siyaram Silk Mills dropped 2.92 per cent, Welspun Living declined 2.53 per cent, Gokaldas Exports went lower by 2.35 per cent and Trident Ltd dipped 2.16 per cent on the BSE.
Among leather and footwear stocks, Zenith Exports tumbled 4.33 per cent, Relaxo Footwears dropped 2.34 per cent, Superhouse Ltd slipped 1 per cent and Khadim India dipped 0.77 per cent.
Among gems and jewellery stocks, Uday Jewellery Industries fell 2.49 per cent, Senco Gold dropped 2.20 per cent, Tribhovandas Bhimji Zaveri declined 1.87 per cent and P N Gadgil Jewellers dipped 1.10 per cent.
In the equity market, the 30-share BSE Sensex tanked 693.02 points to 80,093.52 during morning trade. The 50-share NSE Nifty dived 204.85 points to 24,507.20.
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