Nvidia outlook beats expectations but China worries linger

Chip designer Nvidia (NVDA.O) forecast fiscal fourth-quarter revenue above Wall Street targets on Tuesday as supply-chain issues ease, but a cloudy outlook for China sales weighed on shares that have more than tripled in price this year.

Nvidia, which outsources manufacturing to chipmakers like TSMC (2330.TW), has said it expects supply for its AI chips to improve each quarter, with the company making prepayments and placing noncancellable orders to ensure suppliers prioritize its chips.

Demand for artificial-intelligence servers has grown rapidly, with research firm TrendForce estimating shipments to rise about...