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Though NVidia remains dogged by manufacturing supply problems, the company reported better than expected growth on Friday sending its shares up 9 percent in morning trading.

First-quarter revenue fell to $924.9 from $962 million year-over-year because of a slower than expected economic recovery, but was better than Wall Street’s expectations of $916 million. While the analysts’ average estimate of NVidia’s second-quarter revenue sits at $976.2 million, the company projects that its revenue will be somewhere between $990 million and $1.05 billion.

“Kepler GPUs are accelerating our business,” said Jen-Hsun Huang, President and Chief Executive Officer of NVIDIA, in a statement. “Our newly launched desktop products are winning some of the best reviews we’ve ever had. Notebook GPUs had a record quarter. And Tegra is on a growth track again, driven by great mobile device wins and the upcoming Windows on ARM launch.

A company executive who spoke to Reuters said that Nvidia’s profitability and revenue were being negatively impacted by a manufacturing capacity shortage of 28nm chips at Taiwan Semiconductor Manufacturing Co (TSMC), the company that fabricates chips for NVidia.

In a conference call with analysts and investors, CEO Huang relayed these concerns.

“There’s just not enough capacity,” he said. “In combination between us and TSMC, we underplanned for the supply of 28 nanometer, and we need to fix that in the future.”

CEO Huang also noted during this call that profit margins should grow as Kepler shipments rise.

NVidia forecasts second-quarter gross margin of 51.2 percent, plus or minus one percentage point, compared with 50.1 percent during this quarter.