Nvidia Smashes AI Chip Forecasts, Eases Bubble Concerns/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Nvidia surpassed Wall Street expectations for revenue and earnings, reinforcing its dominance in AI chip technology despite growing fears of an AI market bubble. The company forecast even stronger results for the next quarter, boosting investor confidence. CEO Jensen Huang dismissed bubble talk, describing explosive growth as a technological transformation.
Nvidia Earnings Quick Looks
- Nvidia reported $57 billion in revenue and $31.9 billion in earnings.
- Earnings beat analyst expectations amid AI market bubble concerns.
- Shares jumped over 5% in after-hours trading post-earnings release.
- Nvidia forecasts $65 billion in Q4 revenue, topping projections.
- CEO Jensen Huang called AI growth a “virtuous cycle,” not a bubble.
- Nvidia’s AI chip orders, especially for Blackwell, remain “off the charts.”
- CFO predicts $500 billion in AI chip sales by end of next year.
- Strong performance supports Trump’s tech-focused economic agenda.
Deep Look
Nvidia Calms AI Bubble Fears With Blowout Earnings and Surging Chip Demand
Nvidia delivered another blockbuster earnings report that crushed Wall Street expectations and soothed growing anxiety that the artificial intelligence (AI) market may be approaching a speculative bubble. The Santa Clara-based chipmaker announced fiscal third-quarter results Wednesday that far exceeded forecasts, underscoring its pivotal role in the ongoing AI revolution and easing fears of a tech sector correction.
Revenue for the August to October quarter surged 62% year-over-year to $57 billion, while earnings reached $31.9 billion, or $1.30 per share—a 65% increase. Analysts had projected earnings of $1.26 per share on revenue of $54.9 billion, according to FactSet Research. Nvidia’s optimistic guidance for the next quarter—with projected revenue of $65 billion—came in nearly $3 billion above expectations, indicating that AI chip demand remains robust heading into 2026.
The strong showing helped boost Nvidia’s stock more than 5% in after-hours trading. If gains hold, shareholders could see a $230 billion rise in market value in a single session—an outcome that would further solidify Nvidia’s dominance in a market segment it virtually controls.
CEO Jensen Huang used the opportunity to respond directly to critics who argue that AI enthusiasm has reached unsustainable levels. “There’s been a lot of talk about an AI bubble. From our vantage point, we see something very different,” Huang said. He described the company’s growth as a “virtuous cycle,” where investment drives innovation, which in turn fuels even more demand.
Nvidia’s advanced graphics processors, particularly the highly anticipated Blackwell chips, have become the foundation for so-called “AI factories”—massive data centers built to train and run sophisticated AI systems. According to Chief Financial Officer Colette Kress, orders for these chips are “off the charts.” She projected that the company will have sold around $500 billion worth of AI-focused chips by the end of 2026. Looking ahead, Kress predicted that total spending on AI infrastructure could reach into the trillions by the close of the decade.
The tone of Nvidia’s financial call, often seen as a bellwether for the broader tech sector, reflected a company not only meeting expectations but also helping to shape them. Huang’s comments, which are now widely viewed as a “State of the AI Market” update, were closely watched by investors, policymakers, and industry leaders alike.
Nvidia’s performance also holds political significance. The company has forged close ties with President Donald Trump, whose administration is relying heavily on tech innovation, particularly in artificial intelligence, to anchor its economic strategy. While Trump has pursued aggressive tariffs that restrict chip exports to China, Nvidia’s domestic growth has largely offset the lost opportunities in Asian markets.
Much of the foreign investment drawn by Trump’s policies is now flowing into AI infrastructure, such as data centers and power facilities, rather than traditional manufacturing. This realignment aligns with Trump’s tech-driven economic narrative and further intertwines Nvidia’s success with the administration’s broader economic agenda.
Jay Woods, chief market strategist at Freedom Capital Markets, summed up Nvidia’s centrality to both the economy and the market: “Saying this is the most important stock in the world is an understatement.”
Despite its recent dip—triggered by fears of overheating in the AI sector—Nvidia remains one of the most valuable companies on the planet. At its peak earlier this year, it became the first firm to briefly surpass a $5 trillion market cap. Even after a more than 10% pullback, its market value remains in the $4.5 trillion range.
Nvidia’s gains have also lifted other tech giants closely tied to AI development. Apple, Microsoft, Alphabet (Google’s parent company), and Amazon all continue to see rising valuations, with each boasting market caps between $2 trillion and $4 trillion. These companies are major customers for Nvidia’s chips, using them to build the AI models and infrastructure fueling today’s digital transformation.
The broader economic implications of Nvidia’s success are profound. The company is not only defining the future of AI technology but also anchoring the current bull market in tech. Its sustained growth helps validate the investments made by large corporations and governments in AI, reinforcing the view that this is not just a passing trend, but a foundational shift comparable to the rise of smartphones or the internet itself.
As Nvidia looks toward the end of the decade, the company is positioning itself as the backbone of a new digital age—one where data centers, AI systems, and high-performance computing are as essential as electricity or the internet.
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