Nvidia’s AI supremacy is a weapon that cuts both ways
While the chipmaker is the big winner from the booming technology, it is singularly exposed to changing expectations
IT’S hard to overstate how unlikely it is that a business with almost US$200 billion of annual revenue would grow at a rate of over 60 per cent. Yet, such are the fantastical finances of Nvidia.
The chipmaker that dominates artificial intelligence continued to break all the rules that apply to large companies with its quarterly earnings on Wednesday (Nov 19). Investors who try to predict how long this can persist do so at their peril.
Nvidia is selling every piece of silicon it can make today, and piling up orders for those it plans to make tomorrow. Every indicator worth watching is therefore going up. The company breezed through analysts’ estimates of sales and profit in its latest quarter. Founder Jensen Huang had previously predicted US$500 billion of sales from Nvidia’s newer ranges of chips over 2025 and 2026; his finance chief now expects to beat that.
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