*

Revenue forecast slightly beats estimates but not enough

to wow

markets

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CEO projects $3-4 trillion AI infrastructure spend by

decade-end

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Nvidia's ( NVDA ) AI chip demand remains strong amid market fatigue

By Max A. Cherney

SAN FRANCISCO, Aug 27 (Reuters) - Nvidia ( NVDA ) CEO

Jensen Huang on Wednesday dismissed concern about an end to a

spending boom on artificial intelligence chips, projecting

opportunities will expand into a multi-trillion-dollar market

over the next five years.

Huang sought to reassure investors rattled by

indications of slowing growth at the chipmaker at the center of

the investment frenzy. Nvidia ( NVDA ) earlier in the day forecast

third-quarter revenue meeting analyst estimates but short of the

lofty expectations that have sent its share price up roughly

one-third this year.

The founder and CEO's bullish outlook contrasts with

recent signs of fatigue in AI-focused stocks and comments from

industry leaders about overheated investor enthusiasm.

"A new industrial revolution has started. The AI race is

on," Huang said. "We see $3 trillion to $4 trillion in AI

infrastructure spend by the end of the decade."

Pushing up the chipmaker's shares are expectations of

demand from Big Tech, data center owners known as hyperscalers

and China.

"The mega caps are the ones propelling a lot of the capex

that Nvidia ( NVDA ) is benefiting from. But obviously Nvidia ( NVDA ) still is

growing, is able to sell," said Matt Orton, head of advisory

solutions at Raymond James Investment Management.

"If anything, this just highlights that there's a lot of

durability to this (AI) trade... The businesses of these

hyperscalers can continue to accelerate, and you're not seeing

any sort of sign of a slowdown being reflected in the results of

Nvidia ( NVDA )."

While Nvidia ( NVDA ) shares have outpaced a roughly 10% gain in the

broader market, AI-facing stocks have shown signs of

fatigue. OpenAI CEO Sam Altman set off alarm bells this month

when he said investors may be "overexcited" about AI.

On Wednesday, Huang sounded unperturbed.

"The more you buy, the more you grow," Huang said,

arguing that Nvidia's ( NVDA ) technological advances allow customers to

process increasing amounts of data while using less energy. "The

buzz is: everything sold out."

Case in point: A customer outside China bought $650 million

worth of Nvidia's ( NVDA ) H20 reduced-capability chip aimed at the

Chinese market in the latest quarter, the chipmaker said.

Huang based his forecast in part on the $600 billion he

expects for data center capital spending this year from major

customers such as Microsoft ( MSFT ) and Amazon ( AMZN ).

For a data center costing as much as $60 billion, Nvidia ( NVDA )

can capture about $35 billion, Huang said.

Huang's remarks contrast with a tepid third-quarter

sales forecast of about $54 billion, slightly ahead of the

$53.14 billion average of analyst estimates compiled by LSEG.

Nvidia ( NVDA ) and Huang, however, see little reason for AI chip

profit growth to slow as second-quarter net income surpassed the

fiscal third-quarter profit of Big Tech peer Apple ( AAPL ).

The company's high-end Blackwell chips are largely spoken

for based on 2026 forecasts from its biggest customers. Its

earlier-generation Hopper processors are being snapped up too.

"When you have something that is new, and it's growing as

fast as it is, and with all of the huge capex announcements from

the hyperscalers, it's evidence that we're in the early stages"

of the AI boom, said Globalt Investments portfolio manager

Thomas Martin.