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Nvidia once again beat Wall Street expectations when it released its earnings on Wednesday. But for a company that has enjoyed breathtaking growth over the past two years, good numbers alone may no longer be enough to impress investors.

The AI ​​chipmaker – whose shares have helped fuel the market’s rapid rally this year – reported revenue of more than $30 billion in its fiscal second quarter, up 122 percent from the same period last year and more than the $28.7 billion Wall Street analysts had expected. Quarterly profit also more than doubled, to $16.6 billion, above analysts’ forecast of $15 billion.

The company also released a slightly better-than-expected revenue forecast for the current quarter – another encouraging sign for investors.

Nevertheless, Nvidia shares fell as much as 5% in after-hours trading following the report’s release.

Nvidia’s unparalleled AI processors have contributed to a boom in AI technologies across the tech sector and AI hype on Wall Street. The company’s shares have risen a staggering 154% this year and more than 3,000% over the past five years thanks to the AI ​​hype. The company’s market value is now over $3 trillion, making it one of only three U.S. companies to ever reach that milestone.

However, there are increasing doubts about the sustainability of the hype cycle surrounding artificial intelligence. The main reason for this is the uncertainty about whether – and how quickly – the technology will contribute to the bottom line of the technology giants.

Add to that the fact that a company can only grow that fast for so long. While Nvidia beat Wall Street expectations for revenue and profit, investors seemed disappointed that it didn’t beat expectations by a wide margin. And rumors of potential delays to the company’s latest AI chips, called Blackwell, had added to worries ahead of the earnings report, though executives said during Wednesday night’s earnings call that Nvidia still expects to generate revenue from Blackwell this fiscal year.

“While the numbers suggest that the AI ​​revolution remains alive and well, the weaker performance compared to previous quarters is another indication of the numerous warning signs across the technology space as we enter this earnings season,” Thomas Monteiro, senior analyst at Investing.com, said in an email.

Nvidia CEO Jensen Huang said in a Bloomberg interview on Wednesday that while demand for Blackwell “far exceeds supply,” “we will have a lot of supply and will be able to ramp up production starting in the fourth quarter.”

The performance of Nvidia shares has strong ripple effects throughout the market due to the company’s overweighting of about 7% in the S&P 500.

“The company’s earnings report has become the most important financial event in the world,” Bespoke Investment Group wrote in a statement on Wednesday.

Despite investors’ nervousness, the chip manufacturer has not yet shown any signs of a slowdown in its business.

Nvidia’s data center business continues to be the main driver of its success, a sign that demand for AI infrastructure in the technology sector is not abating. The company generated nearly $26.3 billion in revenue from data center sales, which accounted for 87% of its total revenue.

“The company continues to benefit from a market paradox: Big tech companies’ aggressive AI investment strategies are driving huge demand for Nvidia’s chips, even as those same companies are investing in developing their own silicon,” Emarketer technology analyst Jacob Bourne said in an emailed statement.

Indeed, Silicon Valley heavyweights are continuing to expand their investments in AI infrastructure, much of which will go toward buying chips from Nvidia. In their own earnings reports earlier this month, Google, Microsoft and Meta Platforms all hinted that they would increase their AI spending.

Meta expects full-year capital spending to be between $37 billion and $40 billion, raising the lower end of the previous quarter’s forecast by $2 billion. Microsoft expects higher spending in fiscal 2025 than in 2024 ($56 billion). Google forecast capital spending “at or above” $12 billion for each quarter this year. (Even for extremely wealthy companies, those are big numbers — at Google, capital spending in the second quarter was about 17% of total revenue.)

Despite concerns about possible delays at Blackwell, research firm Third Bridge estimates, according to analyst Lucas Keh, that by the end of next year, 60 to 70% of AI model training at so-called hyperscalers such as Microsoft and Google will take place with the new Nvidia chips.

Nvidia CEO Jensen Huang defended the company’s launch during a conference call with analysts on Wednesday following the report’s release, reminding them that the company’s chips power not just AI chatbots, but also ad targeting systems, search engines, robots and recommendation algorithms like those behind social media feeds.

“Anyone who invests in Nvidia’s infrastructure will get an immediate return,” Huang said, adding that the company’s more powerful chips process data more efficiently, saving customers money. “In the future, every single data center will have GPUs,” the type of chips Nvidia has become known for, Huang said.

Together, these factors should mean that even if the hype surrounding Nvidia stock – which has now reached such a point that people have been organizing quarterly earnings calls as if it were endgame – dies down, the company’s fundamentals should remain strong for the foreseeable future.