Key points
- Nvidia CEO Jensen Huang projects a multi-trillion-dollar AI infrastructure market within the next five years.
- Q3 revenue forecast met analyst expectations, but fell short of extremely high investor expectations.
- Huang’s optimistic outlook contrasts with recent concerns about the AI market overheating.
- Strong demand from major tech companies and hyperscalers continues to fuel Nvidia’s growth.
Nvidia CEO Jensen Huang delivered a confident message on Wednesday, dismissing concerns about a potential slowdown in the booming artificial intelligence chip market. Despite Nvidia’s third-quarter revenue forecast slightly missing overly optimistic investor expectations, Huang projected a massive expansion of the market to $3 trillion to $4 trillion by the end of the decade.
This optimistic outlook directly counters recent anxieties expressed by some industry leaders and investors who have voiced concerns about an overheated market and potential fatigue in AI-focused stocks.
Huang’s bullish prediction is fueled by robust demand from major technology companies and hyperscalers – the large data center operators – who are driving substantial capital expenditure in AI infrastructure. He highlighted the significant investments from companies like Microsoft and Amazon, projecting a sizable share for Nvidia within this massive data center spending.
One significant example cited was a single non-Chinese customer purchasing $650 million worth of Nvidia’s H20 chips, originally designed for the Chinese market, showcasing continued strong global demand.
This persistent demand is further underscored by the fact that Nvidia’s high-end Blackwell chips are practically sold out through 2026 based on pre-orders from major clients.
Even the earlier generation Hopper processors are experiencing high demand, suggesting that the current growth is far from peaking. Huang emphasized that the company’s technological advancements allow customers to process more data with greater energy efficiency, further driving demand.
The positive outlook, however, contrasts with a slightly subdued Q3 revenue forecast, which, while meeting analyst expectations, didn’t reach the exceptionally high levels predicted by some investors earlier this year.
Yet, Nvidia’s strong second-quarter net income, exceeding that of Apple’s fiscal third quarter, reinforces Huang’s confidence in sustained growth within the AI sector. He believes the industry is still in the early stages of a significant boom driven by continuous heavy investment from major players.
