Nvidia forecasts quarterly revenue above estimates
The company said AI chip demand remains strong and projected gross margin at 74%, while investors still weigh competition and China sales risks.
- On Wednesday, Nvidia forecast $108 billion in quarterly revenue, beating Wall Street estimates, yet shares fell 1.2% in extended trading as investors remained skeptical about long-term AI market dominance.
- Growing competition from central processors and custom chips by rivals Intel and AMD, coupled with Big Tech customers like Microsoft and Meta investing in in-house chip efforts, has undermined investor confidence.
- Big Tech companies reinforced expectations to spend more than $730 billion on AI infrastructure this year, up significantly from last year's 400 billion outlay, while Nvidia expects a gross margin of roughly 74%.
- Scrutiny has mounted of Nvidia's role in the AI financing ecosystem after it agreed to guarantee deals aimed at raising more than $500 billion, while the company unveiled a Vera Rubin platform using Groq technology in March.
- Despite projecting a revenue opportunity exceeding $1 trillion through 2027, Nvidia has gained just 14.2% so far this year as of Tuesday's close, while AMD and Intel have more than doubled.
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136 Articles
Asian chip firms lifted by Nvidia forecast but broader markets struggle
In a highly anticipated report, the world's most valuable company shattered forecasts by unveiling revenues more than doubled on-year in the second quarter and said it expected another blowout in July-September. Nvidia is considered the bellwether for the AI spending frenzy, with its results largely determined by mega purchases from AI giants such as OpenAI, Amazon, Microsoft and xAI. The firm has led an eye-watering rally by tech firms over the…
The AI boom further boosts the world's most valuable group, as the current quarterly figures show, and the pace of growth is set to remain high. According to Group CEO Jensen Huang, AI has "achieved its key moment."
Nvidia reported a net profit of 59,688 million dollars in the second quarter of its 2027 financial year.
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