Shares of NVIDIA surged nearly 9% on Thursday, adding roughly $440 billion to its market capitalization, after its latest earnings report and forward guidance reassured investors that demand for artificial intelligence infrastructure remains robust. The bullish reaction suggests the chipmaker may defy the pattern of share price declines on the day following its past four quarterly reports, even though each of those releases had met or exceeded expectations.
The positive momentum spilled over into other semiconductor names, with Broadcom and Intel both trading higher in the wake of the announcement. Newer cloud service provider Nebius also saw gains, while CoreWeave shares held steady. The broad rally underscored the market's renewed confidence in the AI trade following a volatile period earlier this year.
During Wednesday's earnings call, NVIDIA Chief Financial Officer Colette Kress projected revenue growth of 70% for fiscal 2028, which spans February 2027 through January 2028. Chief Executive Officer Jensen Huang went further, stating that demand is "well above 70%," but noted that the company remains constrained by product supply limitations. Key bottlenecks persist at TSMC, the company's primary manufacturer, and memory chip supply continues to lag behind demand for NVIDIA systems.
Analysts on Thursday also flagged a potential competitive threat to NVIDIA's near-monopoly in cutting-edge AI accelerators. Hyperscale cloud providers and AI labs, including OpenAI, have recently announced plans for custom-designed silicon, which could challenge the company's dominance in the years ahead. Despite these concerns, the immediate market reaction focused on the strength of current demand signals.
Huang noted that NVIDIA has "never given a forecast a year in advance" before, but the company now has "greater visibility" into its supply chain, allowing for longer-range guidance. The projection comes at a time when investors have grown uneasy about the cyclical nature of capital expenditure among big tech firms, the sustainability of financing deals, and the eventual return on massive AI investments. The company's commentary on demand appears to have alleviated some of those fears.
Huang declared that AI has "reached a tipping point," highlighting a sharp increase in the number of companies requiring massive GPU clusters. "This time last year, only one lab was driving infrastructure buildout," he said. "Today, we have a golden age of new AI labs and startups, multiple frontier labs scaling in parallel, a thriving open-source model ecosystem, and physical AI coming online—strong momentum in the U.S. and around the world."
NVIDIA also sought to demonstrate that its revenue base is diversifying beyond hyperscale customers. Its AI cloud, industrial, and enterprise segment contributed $40.3 billion in sales this quarter, up 138% year over year. The broadening customer mix is seen as a key factor in sustaining long-term growth.
"NVIDIA's earnings report tells you today's valuation is cheap," said Siddy Jobe, senior portfolio manager at Econopolis Wealth Management's Index Technology Fund. "There's still a lot of upside in the stock." After chip stocks erased $1 trillion in market value in July and later rebounded, triggering concerns about a broader market correction, confidence appears to have returned to the agenda following NVIDIA's results.
"I continue to be very bullish on NVIDIA and the entire ecosystem," said Paul Meeks, head of technology research at Freedom Capital Markets. "I don't think we'll see a real threat of a slowdown until at least 2028."
In a separate development, NVIDIA has reportedly agreed to acquire open-source platform Hugging Face for $12.9 billion, according to sources cited by The Information. Business Insider separately reported that NVIDIA had been "in talks" to acquire the company. If completed, the deal would bring one of the most widely used platforms for sharing and working with open-source AI models under NVIDIA's ownership, extending the chipmaker's reach deeper into the software and model ecosystem.
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