Nvidia gave its first-ever year-ahead forecast—a 70% growth bombshell meant to silence AI bubble critics and ‘circular financing’ doomsayers

On Wednesday, Nvidia surprised investors by announcing a forecast of 70% revenue growth for the next fiscal year. The company's CEO, Jensen Huang, stated that AI chip demand is increasing at an impressive 100% rate. This projection far exceeded the estimated revenue of around $570 billion for fiscal 2028, which translates to between $690 billion and $700 billion, significantly surpassing the $570 billion analysts had anticipated.

CEO Huang emphasized that Nvidia has never provided such a year-ahead forecast previously. Nvidia CFO, Colette Kress, highlighted that customers' estimates suggest revenue growth doubling next year. However, the company is grappling with significant supply constraints, much like other major tech firms. Huang clarified that if supply were not a bottleneck, their revenues would grow even more.

Despite this, Nvidia's revenue for Q2 was $96.2 billion, up 106% YoY and surpassing analyst projections of $92.2 billion. The company expects revenue of $108 billion in its next quarter, aligning with the analyst's whisper range of $105 billion to $108 billion. Nvidia's growth is driven by demand from hyperscale cloud providers as well as non-hyperscales, including sovereign AI, neoclouds, AI startups, and enterprises.

The latter group represents roughly half of Nvidia's business and is growing at a rapid 100% annual rate. Huang explained that the increasing demand is due to the greater compute requirements of AI agents compared to human users. Lastly, Nvidia CFO Kress addressed critics who raise concerns about Nvidia's financing of other AI companies.

Kress defended the company's approach, stating that they view these investments as high-reward, low-risk ventures, as the AI labs they support have proven technology and customer traction.