Nvidia reported strong earnings, with its core data center business experiencing 46 percent growth and company guidance slightly ahead of market expectations. CNBC's Arjun Kharpal runs through the key themes and takeaways from Nvidia's earnings.

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Nvidia reported strong earnings, with its core data center business experiencing 46 percent growth and company guidance slightly ahead of market expectations. The company highlighted ongoing high demand for its AI products, with CEO Jensen Huang noting that major products are sold out and infrastructure spending on AI is expected to reach trillions over the next decade.

Despite these positive results, uncertainty remains around Nvidia's business in China. The company's forecast did not include potential sales of its H20 product to China, and while up to $5 billion in sales to the region is possible, this depends on the geopolitical environment. Additionally, proposed U.S. government regulations could impact revenue from China, but these have not yet been enacted.

Nvidia earnings: The key takeaways from China to AI demand

These earnings were very good and we have to split it into two parts here. I think the core part of the Nvidia business and the China equation which really muddied the waters overall. If we think about the core first we heard sort of guidance of 54 billion dollars that was slightly ahead of consensus and that was without taking into account any sales of the H20 to China. So still pretty strong. You know they were saying the core data center business 46 percent growth still still very strong as well. And what we heard was a little bit more about the demand going forward. The company saying they're expecting three to four trillion dollars of infrastructure spend on A.I. over the next decade and capex from the hyperscale is to double to about six hundred billion. Now that was an interesting part of the call where Jensen Huang was actually asked whether the 50 percent growth rate he'd predict in China was a good indication for the broader data center business globally. You couldn't commit to the actual numbers of course. But Jensen Huang did give us an indication of what he was expecting in terms of demand. Let's listen in. The buzz is everything sold out. H1 has sold out. H2 hundreds are sold out. Large CSPs are coming out renting capacity from other CSPs. And so the the A.I. native startups are really scrambling to get capacity so that they could train their reasoning models. And so the demand is really really high. But the long term long term outlook between where we are today capex has doubled in two years. It is now running about six hundred billion dollars a year just in the large hyperscalers. You know for us to grow into that six hundred billion dollars a year representing a significant part of that capex isn't unreasonable. So very strong forecast there from from Jensen Huang even though he didn't confirm that 50 percent growth rate but giving strong indications that that demand continues to remain strong. The second part as I mentioned was China. That really muddied the waters here. That 54 billion dollar forecast for the current quarter doesn't include any H20 sales. Many had thought they might give an indication of that. The CFO did say that two to five billion dollars worth of sales to China is possible in this quarter if the geopolitical environment permits. But remember the government of the United States has said they want a 15 percent cut of revenue from Nvidia sales to China. But the CFO said that that actually hasn't been codified in law yet. So a little bit of uncertainty around the China picture at the moment which I think muddied what was an overall very strong report.

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Nvidia earnings: The key takeaways from China to AI demand

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