Nvidia profits fail to spark share price rally; UK car production falls ahead of new models – business live

Good morning, and welcome to our live coverage of business, economics and financial markets.

Nvidia shares are down 7% in after-hours trading despite actually beating analyst expectations for sales and profits.

The Silicon Valley chip designer reported sales more than doubling to $30bn (£23bn), up 122% in the second quarter compared with last year. Analysts had expected sales of $28.7bn on average.

Jensen Huang, founder and chief executive of Nvidia, said anticipation for its forthcoming Blackwell chips – which squeeze in 208bn transistors to carry out the calculations needed to train large language model – was “incredible”, and demand for its current range remained strong. He said:

Nvidia achieved record revenues as global data centers are in full throttle to modernize the entire computing stack with accelerated computing and generative AI.”

So how come shares fell after US trading hours when the company gave every signal that it believes it is still riding the crest of the artificial intelligence (AI) wave?

One might have been the lack of detail on delays that hit Blackwell chip production – although the company suggested those manufacturing issues had been sorted by TSMC, the Taiwan semiconductor manufacturer that builds Nvidia’s most advanced chips.

But another may be that the company’s growth has been so enormous that it needs to not just beat expectations to rise further, but smash them.

Henry Allen, a strategist at Deutsche Bank, said:

Although the results slightly beat expectations, their share price was down around -7% in after-hours trading, partly because it fell short of some estimates that had been looking for an even stronger release. For instance, the revenue outperformance was the smallest relative to expectations in six quarters, so this wasn’t the sort of massive beat that Nvidia has often reported over the last 18 months.

At the same time, the Q3 revenue guidance came in a touch above the average estimate ($32.5bn vs $31.9bn est.) but still well within the range of analysts’ views.

UK car production slips as carmakers prepare for new models

Back in the UK, car manufacturing numbers are down, but only as companies switch production to new models, according to the Society of Motor Manufacturers and Traders (SMMT).

The lobby group said that production dropped 14.4% in July “as model changeovers and temporary supply chain constraints restrict output”.

One of those new models is likely to be the electric Range Rover, the first electric car to be built in Britain by Jaguar Land Rover, the UK’s biggest manufacturer. Its only other electric model, the Jaguar I-Pace, is built by a contract manufacturer in Austria.

The industry produced 482,000 cars in the first seven months of the year, down 9% from 2023. The SMMT is hoping that annual production will rise above 1m cars next year as new models start production.

Mike Hawes, chief executive of the SMMT, said

Following significant growth last year, some readjustment in output was to be expected. Indeed, an ongoing degree of volatility is likely as the industry restructures to transition to zero emission vehicle production.

As the billions already committed to new models start to deliver a return, volume growth will resume, providing we seize every opportunity to enhance our global competitiveness.

The agenda

• 10am BST: Eurozone consumer confidence (August; -13 point; consensus: -13.4)

• 10:15am BST: European Central Bank speech by chief economist Philip Lane in Frankfurt

• 1pm BST: Germany inflation rate (August; prev.:2.3% annualised; cons.: 2.1%)

• 1:30pm BST: US GDP second estimate (second quarter; prev.: 1.4% annualised; cons.: 2.8%)