Nvidia shares slump 3% in premarket as quarterly revenue growth slows

Nvidia shares dropped successful U.S. premarket trading Thursday aft the tech giant's third-quarter net failed to impressment investors.

Shares of the chipmaker slumped 3.21% astatine astir 5:03 a.m. ET, pursuing the Wednesday merchandise of Nvidia's quarterly results, which beat connected some the apical and bottommost lines.

Revenue came successful astatine $35.08 billion, up 94% year-on-year and exceeding the $33.16 cardinal forecast by LSEG analysts. Earnings per stock was 81 cents adjusted, besides supra expert expectations.

Other chipmakers fell connected the backmost of the marketplace absorption to Nvidia's third-quarter results. Shares of Intel, Qualcomm and Micron Technology each mislaid 1% oregon much successful value, portion AMD declined 0.6%.

The slump successful Nvidia besides had a knock-on effect connected European semiconductor firms. ASML, a cardinal spot instrumentality supplier, dropped 0.9%, portion compatriot Dutch spot steadfast ASMI fell 0.5%. Chipmakers BE Semiconductor, STMicroelectronics and Infineon slipped 0.8%, 0.7 and 0.6%, respectively.  

Several notable spot names were also successful antagonistic territory successful Asia. TSMC, which makes Nvidia's high-performance graphics processing units, eased arsenic overmuch arsenic 1.5%. Contract electronics shaper Foxconn dropped 1.9%.

Nvidia has mostly cornered the marketplace for the high-powered chips powering the world's astir precocious artificial quality models, specified arsenic OpenAI's ChatGPT.

Despite astir doubling income year-on-year, Nvidia's third-quarter results showed a slowdown from erstwhile quarters. Nvidia antecedently reported maturation of 122% successful the 2nd quarter, 262% successful the archetypal quarter, and 265% successful the 4th fourth of 2023.

Derren Nathan, caput of equity probe astatine Hargreaves Lansdown, said successful emailed comments Wednesday that the dip successful Nvidia's stock terms "suggests adjacent outstanding isn't capable for immoderate investors," adding that helium expects the banal to bounce backmost erstwhile markets open.

"NVIDIA's generated stellar gains for shareholders implicit galore years now, and close present it's beauteous hard to spot immoderate large holes successful the concern case," Nathan added.

Analysts are looking up to the much-anticipated motorboat of Nvidia's next-generation spot called Blackwell. On the firm's net call, CEO Jensen Huang said that demand for the spot is exceeding supply.

- CNBC's Kif Leswing contributed to this report