A Nvidia predicted on Wednesday (19) revenue for the fourth quarter above estimates of Wall Street, betting on strong demand for its AI chips from cloud providers amid widespread concerns about an artificial intelligence bubble.
as global markets were keeping an eye on the company to determine whether its billion-dollar investment in expanding AI infrastructure had resulted in exorbitant valuations that potentially outpaced fundamentals.
The most valuable company in the world forecasts sales of US$65 billion in the fourth fiscal quarter, with a margin of error of 2%, compared to the average analyst estimate of US$61.66 billion, according to data compiled by LSEG.
Before the results were announced, doubts caused Nvidia shares fell almost 8% in November, after a 1,200% increase in the last three years. The S&P 500 index, overall, is down almost 3% this month.
Still, analysts and investors widely expected that since ChatGPT launched in late 2022, it would remain strong.
Nvidia CEO Jensen Huang said last month that the company has $500 billion in orders for its advanced chips through 2026.
Big tech companies, among Nvidia’s biggest customers, have doubled down on their investments to expand AI data centers and acquire the most advanced and expensive chips, committing to billion-dollar projects and several gigawatts of capacity.
Last month, Microsoft announced record capital spending of nearly $35 billion for its fiscal first quarter, with roughly half of that spent primarily on chips.
