Wall Street says Nvidia's blockbuster earnings prove the AI boom is nowhere near its peak

Core Viewpoint - Nvidia's strong third-quarter earnings demonstrate that the AI boom is still robust, alleviating concerns about a potential AI bubble [1][3]. Financial Performance - Nvidia reported $57 billion in revenue, exceeding Wall Street's estimate of $55 billion, with its data center division generating $51 billion, surpassing the projected $49.31 billion [2]. - The company posted earnings of $1.30 per share, slightly above the $1.26 estimate, and forecasted $65 billion in revenue for the fourth quarter, exceeding expectations of $61.98 billion [2]. Market Reaction - Following the earnings report, Nvidia's stock rose approximately 3% in after-hours trading and climbed about 4.5% as the analyst call concluded [3]. - Analysts view the results as a significant validation of the ongoing AI revolution, with some suggesting that fears of an AI bubble are overstated [3][4]. Industry Insights - Despite concerns over rising capital expenditures estimated at over $400 billion across major cloud platforms, Nvidia's results indicate that tech companies are committed to scaling their data centers [4]. - Analysts noted that while there are ongoing concerns regarding capex sustainability and competition, Nvidia's performance provides confidence in its execution [5]. Product Demand - Nvidia reported strong sales for its Blackwell and Rubin chips, with expectations of continued growth in revenue from these products through 2026 [7][8]. - The company has $500 billion in AI-chip orders booked for 2025 and 2026, indicating robust demand [8]. Supply Chain and Capacity - Nvidia's CEO highlighted that cloud GPUs are sold out, and demand for Blackwell GB300 GPUs is particularly strong, accounting for two-thirds of Blackwell sales [9][10]. - Analysts believe that the current supply constraints and full utilization of Nvidia's products will help stabilize AI stocks moving forward [10]. AI Bubble Discussion - Nvidia's CEO addressed concerns about an AI bubble, asserting that the company is uniquely positioned in the AI space and does not see evidence of a bubble [11]. - Contrasting views exist, with some industry leaders warning of potential pitfalls in AI investments, while others argue that the current developments represent a new industrial structure rather than a bubble [12][13].