Nvidia CEO Jensen Huang has dismissed fears of a slowdown in the artificial intelligence (AI) market, insisting that the AI investment boom is only beginning. Speaking on Wednesday, Huang said opportunities in AI infrastructure will expand into a multi-trillion-dollar industry over the next five years, even as Nvidia shares dipped following a weaker-than-expected sales forecast.
Nvidia’s Sales Forecast Disappoints Investors
Shares of Nvidia (NASDAQ: NVDA) fell 1.56% to $178.77 in premarket trading on Thursday after the company’s third-quarter sales forecast came in below expectations.
The outlook excluded potential revenue from China, highlighting ongoing U.S.-China trade tensions that continue to cloud the chipmaker’s future growth prospects. Despite this cautious forecast, Huang moved to calm investor concerns, emphasising the long-term strength of AI demand.
“The AI Race Is On” – Huang
Huang, who founded Nvidia, painted a bullish picture of the AI sector, countering concerns about slowing growth and investor fatigue in AI-focused stocks.
“A new industrial revolution has started. The AI race is on. We see $3 trillion to $4 trillion in AI infrastructure spend by the end of the decade,” Huang said.
He stressed that demand from Big Tech companies, hyperscalers, and cloud service providers will continue to power Nvidia’s growth.
Analysts See Durability in AI Investment
Industry experts argue that Nvidia’s market position remains strong despite short-term concerns.
“The mega caps are the ones propelling a lot of the capex that Nvidia is benefiting from. But obviously Nvidia still is growing, is able to sell,” said Matt Orton, Head of Advisory Solutions at Raymond James Investment Management.
Orton added that Nvidia’s performance shows the durability of the AI trade, as hyperscalers’ businesses continue to accelerate without signs of slowdown.
AI Stocks Show Signs of Fatigue
While Nvidia stock has significantly outperformed the broader market’s 10% gain, AI-related stocks are beginning to show cracks. Earlier this month, OpenAI CEO Sam Altman warned that investors may be “overexcited” about AI, raising questions about whether the sector is overheating.
Despite these concerns, Nvidia remains at the centre of the AI chip revolution, benefiting from massive demand for data centre GPUs and enterprise AI adoption.
Conclusion
Although Nvidia’s near-term sales forecast disappointed Wall Street, CEO Jensen Huang insists the AI boom is far from over. With trillions expected in AI infrastructure spending by the end of the decade, Nvidia remains well-positioned to lead in a rapidly growing market.
