Nvidia’s stock experienced immediate volatility following the announcement of its 2025 Q2 financial results, with an initial decline in price despite better-than-expected earnings and continued strong growth in AI demand. The primary causes were concerns about slowing sequential growth in data center revenue and uncertainties regarding future sales to China, even though total revenue and earnings exceeded analyst forecasts. 2025 Q2 Results Overview Revenue: $46.7 billion, up 56% year-over-year and 6% sequentially, beating estimates. Earnings per Share: $1.05 adjusted, surpassing forecasts. Growth Drivers: Robust demand for AI infrastructure and strong performance of the new Blackwell platform, which saw a 17% sequential revenue increase within the data center segment. Stock Performance After Earnings Nvidia shares fell 2–3% in after-hours trading immediately after the earnings release, reflecting investor disappointment in data center revenue and cautious Q3 outlook despite the overall earnings beat. The losses stabilized the following day, although shares did not rebound to pre-announcement levels. Year-to-date, Nvidia stock remains up about 35%, following a near tripling in 2024. Cause Analysis Data Center Revenue Shortfall: Investor expectations were particularly high for Nvidia’s data center segment. Although this division grew 56% year-over-year, sequential growth was modest and missed some aggressive Wall Street targets, contributing to stock price pressure. China Market Uncertainty: Regulatory hurdles and export restrictions on the H20 chip to China removed China data center revenue from the outlook, leading to significant uncertainty about potential future earnings from the region. Although CEO Jensen Huang remains optimistic about the market's size and growth, the lack of clarity weighed heavily on investor sentiment. Guidance and Outlook: Nvidia projected Q3 revenue at $54 billion—healthy growth, but with China excluded. The ongoing AI infrastructure surge globally remains a bright spot, but slowing sequential growth and persistent China uncertainty tempered the stock’s immediate prospects. Key Takeaways Nvidia is delivering strong earnings growth on the back of global AI infrastructure demand, but short-term investor worry centers on data center revenue growth rates and unresolved China market access. Longer-term, the outlook remains positive as Nvidia continues to lead in AI technology innovation and anticipates robust future demand if geopolitical risks diminish.