05:11 PM EDT, 08/27/2025 (MT Newswires) -- Nvidia's ( NVDA ) fiscal second-quarter earnings surpassed Wall Street's estimates as the chipmaker benefited from rising generative artificial intelligence demand.

The technology bellwether's adjusted per-share earnings increased to $1.05 during the three months ended July 27 from $0.68 a year earlier. That topped the consensus on FactSet of $1.01. Revenue climbed 56% to $46.74 billion, exceeding the Street's $46.05 billion call.

Data center revenue jumped 56% year-over-year to $41.1 billion, reflecting demand for its computing platform used for large language models and gen AI applications, Chief Financial Officer Colette Kress said in comments posted on the company's website late Wednesday.

"There were no H20 sales to China-based customers in the second quarter," the company said. "Nvidia ( NVDA ) benefited from a $180 million release of previously reserved H20 inventory, from approximately $650 million in unrestricted H20 sales to a customer outside of China."

Shares of Nvidia ( NVDA ), which last month became the first public company in the world to reach $4 trillion in market capitalization, dropped 3% in after-hours trade. The stock was up 35% so far this year through Wednesday's close.

The US government informed Nvidia ( NVDA ) in April that the chipmaker required a new license to export its H20 graphics processing units to China. The company said last month that it was filing applications to resume H20 sales in China and that it had received assurance from Washington that licenses would be granted.

Nvidia ( NVDA ) is in talks with the US about shipping a more advanced chip to Beijing, CNBC reported Friday, citing Chief Executive Jensen Huang. Earlier in August, Nvidia ( NVDA ) and Advanced Micro Devices ( AMD ) reportedly agreed to give 15% of their AI chip sales in China to the US as part of a deal to get export licenses.

Tigress Financial Intelligence on Monday described Nvidia's ( NVDA ) earnings as the most closely watched report of this quarterly season. The brokerage expected Nvidia ( NVDA ) to deliver record results amid robust demand for data center processors and Blackwell.

Nvidia's ( NVDA ) graphics processing units power more than 80% of AI data centers across the world, Ivan Feinseth, chief market strategist of Tigress, wrote in the Monday note.

The company expects third-quarter consolidated revenue of $54 billion, plus or minus 2%. The consensus estimate indicates $53.43 billion.

Nvidia ( NVDA ) carries the largest weight in the S&P 500, at about 8%, "so its guidance can sway broad portfolios," Saxo Bank said in a report published Tuesday. About nine in 10 analysts rate the stock a buy, Saxo Investment Strategist Ruben Dalfovo wrote.

"Nvidia ( NVDA ) has become the heartbeat of the AI trade. Its chips and networking gear power cloud training and inference at companies like Microsoft ( MSFT ) , Alphabet (GOOG, GOOGL), Amazon ( AMZN ) , and Meta (META)," Dalfovo said. "When Nvidia ( NVDA ) guides up, confidence ripples across semis, equipment, memory, and the hyperscalers. When it wobbles, the air comes out of the whole complex."

Nvidia ( NVDA ) said Wednesday its board has expanded the company's share repurchase program by $60 billion.