Nvidia rises after signaling longer AI spending runway

Nvidia shares rose before the bell on Thursday as investors embraced ​the chipmaker's strong long-term ​outlook, betting that a global race to build AI infrastructure ​will fuel years of rapid growth despite concerns about supply bottlenecks and financial ties with customers.

Shares rose 6.7% to $223.71 before the bell, putting Nvidia on track to add ‌about $340 billion ⁠to its ⁠market value.

The world's most valuable company projected 70% revenue growth next fiscal year and ​forecast current-quarter sales above Wall Street estimates, signaling that the AI spending boom remains ​intact.


The upbeat outlook rippled through global semiconductor markets, sending AI-linked stocks higher in Europe and China and offering fresh ammunition to bulls.

Nvidia's shares have ​fallen nearly 12% from their May peak amid ⁠growing investor ‌demands for evidence that the AI spending boom would ​endure.

Following the ​results, at least 10 brokerages raised their price target ⁠on the shares, according to data compiled by LSEG.

Analysts ​at Morgan Stanley said, "70% growth supply constrained is a ​remarkable figure, and to the extent possible we would expect Nvidia to continue to knock down barriers to higher growth."

The forecast marked a rare long-term outlook from Nvidia, with CEO Jensen Huang saying AI had reached an "inflection point" as the technology moves from experimentation to real-world deployment.

Nvidia ‌signaled that AI demand is spreading beyond hyperscalers, citing growth from AI labs, rising capacity among neo-cloud providers such as ​CoreWeave and ​Nebius, and a ⁠deeper partnership with Amazon Web Services.

Shares of CoreWeave and Nebius rose 5.8% and 7.2%, respectively.

Morgan Stanley analysts said that Nvidia's push into cloud revenue-sharing could ​become a fresh catalyst for the stock.

The company reported second-quarter revenue of $96.2 billion, ahead of Wall Street expectations, driven by $89 billion in data center sales.

The stock trades at 17.9 times forward earnings estimates, well below Advanced Micro Devices' 37.2 times and Intel's 46.2 times.