Soaring AI demand sends Nvidia profits rocketing up by 109%

American chipmaker Nvidia beat sales expectations for its third quarter after it saw its profit  more than double thanks to a growing demand in artificial intelligence. 

The Santa Clara, California-based firm, which has solidified itself as the world's most valuable company following its third quarter performance,  saw its profit jump by 109% to $19.3 billion, beating analyst forecasts of $17.4 billion. 

Meanwhile, revenue jumped 94% year-on-year to $35.1 billion, when analysts had forecasted sales of $33.2 billion. 

Nevertheless, Nvidia's shares fell by 2.3% to $14.58 in after-hours trading, as investors have been questioning prospects for AI, as well as concerns that tech stock are overvalued.

Looking ahead, the firm expects to achieve revenue of $37.5 billion in its next quarter, while analysts are forecasting $37.1 billion in sales. 

Founder and CEO Jensen Huang said: 'The age of AI is in full steam, propelling a global shift to Nvidia computing', adding that demand for Nvidia's newest chips was 'incredible'.

'AI is transforming every industry, company and country. Enterprises are adopting agentic AI to revolutionize workflows. Industrial robotics investments are surging with breakthroughs in physical AI. And countries have awakened to the importance of developing their national AI and infrastructure,' he added. 

The AI chipmaker has seen a staggering rally in the two years since ChatGPT launched an AI frenzy.

As such, Nvidia's success has become a bellwether of the ongoing artificial intelligence boom.

Its market capitalization has grown more than nine times over since the end of 2022.

Nvidia is currently worth $3.6 trillion, overtaking Apple.

Nvidia chips are used by more than 40,000 companies and its customers include Amazon, Apple, Tesla, Microsoft and Meta. 

Tech giants buy Nvidia chips to build AI data centres, which power generative AI products like ChatGPT.