Analysts count on AI chip demand to stay robust.
Revealed On 19 Nov 2025
Nvidia has forecast fourth-quarter income above Wall Road estimates and is betting on booming demand for its AI chips from cloud suppliers whilst widespread issues of a man-made intelligence bubble develop stronger.
The world’s most dear firm expects fourth-quarter gross sales of $65bn, plus or minus 2 p.c, in contrast with analysts’ common estimate of $61.66bn, in accordance with information compiled by LSEG.
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The outcomes from the AI chip chief mark a defining second for Wall Road as world markets look to the chip designer to find out whether or not investing billions of {dollars} in AI infrastructure growth has resulted in towering valuations that doubtlessly outpace fundamentals.
“The AI ecosystem is scaling quick with extra new basis mannequin makers, extra AI start-ups throughout extra industries and in additional international locations. AI goes all over the place, doing every part, suddenly,” Nvidia CEO Jensen Huang stated in a press release.
Earlier than the outcomes, doubts had pushed Nvidia shares down almost 8 p.c in November after a 1,200 p.c surge previously three years.
Gross sales within the data-centre phase, which accounts for a majority of Nvidia’s income, grew to $51.2bn within the quarter that ended on October 26. Analysts had anticipated gross sales of $48.62bn, in accordance with LSEG information.
Warning indicators
However some analysts famous that components past Nvidia’s management may impede its progress.
“Whereas GPU [graphics processing unit] demand continues to be large, buyers are more and more centered on whether or not hyperscalers can truly put this capability to make use of quick sufficient,” stated Jacob Bourne, an analyst with eMarketer. “The query is whether or not bodily bottlenecks in energy, land and grid entry will cap how shortly this demand interprets into income progress by way of 2026 and past.”
Nvidia’s enterprise additionally turned more and more concentrated in its fiscal third quarter with 4 clients accounting for 61 p.c of gross sales. On the similar time, it sharply ramped up how a lot cash it spends renting again its personal chips from its cloud clients, who in any other case can’t hire them out, with these contracts totalling $26bn – greater than double their $12.6bn within the earlier quarter.
Nonetheless, analysts and buyers broadly anticipated the underlying demand for AI chips, which has powered Nvidia outcomes since ChatGPT’s launch in late 2022, to stay robust.
Nvidia CEO Jensen Huang stated final month that the corporate has $500bn in bookings for its superior chips by way of 2026.
Massive Tech, amongst Nvidia’s largest clients, has doubled down on spending to develop AI information centres and snatch essentially the most superior, expensive chips because it commits to multibillion-dollar, multigigawatt build-outs.
Microsoft final month reported a document capital expenditure of almost $35bn for its fiscal first quarter with roughly half of it spent totally on chips.
Nvidia expects an adjusted gross margin of 75 p.c, plus or minus 50 foundation factors within the fourth quarter, in contrast with market expectation of 74.5 p.c.
