Nvidia has reported record revenues of $30bn (£24.7bn) over a three-month period, yet its shares fell by 6% in after-hours trading.

The company, a major player in the AI chip market, has seen its stock market value soar to over $3 trillion, benefiting greatly from the AI boom.

However, analysts are noting a slowdown in the rate of growth. Simon French, head of research at Panmure Liberum, stated, “that rate of growth was starting to slow.” Analysts had anticipated sales growth of $28.7bn for the quarter ending July 28, but Nvidia exceeded expectations with a 122% increase compared to the same period last year.

Despite this impressive growth, Nvidia’s share price took a hit, dropping about 2% in early trading the following day. Nevertheless, the stock remains approximately 150% up for 2024, marking it as one of the significant winners in the US market.

Matt Britzman, a senior equity analyst at Hargreaves Lansdown, commented, “It’s less about just beating estimates now. Markets expect them to be shattered, and it’s the scale of the beat today that looks to have disappointed a touch.”

Nvidia’s CEO, Jensen Huang, remarked, “Generative AI will revolutionise every industry.” However, French cautioned that maintaining high expectations requires continuous spectacular growth.

One factor contributing to the stock’s decline may be production delays with Nvidia’s next-generation Blackwell chip, as noted by French.

The quarterly results announcement has become a significant event, often leading to intense trading activity on Wall Street. A “watch party” was even planned in Manhattan, highlighting the excitement surrounding Nvidia’s performance.

Alvin Nguyen, a senior analyst at Forrester, emphasized that both Nvidia and Huang have become synonymous with AI. While this has bolstered the company’s image, it poses risks if AI does not meet the high expectations set by investors.

Nguyen stated, “A thousand use cases for AI is not enough. You need a million.” He also pointed out that Nvidia’s first-mover advantage has solidified its market position, but competitors like Intel could potentially erode its market share if they develop superior products.