Nvidia’s results show AI boom is not running out of demand

 
Lale Akoner, global market strategist at etoro, discussing Nvidia’s results.
 

Nvidia’s results show AI boom is not running out of demand

 
Lale Akoner, global market strategist for etoro, says: “Nvidia’s results show that the AI boom is not running out of demand. The constraint is increasingly the industry’s ability to supply and finance the infrastructure required.

“Revenue reached $96.2 billion, Data Center sales beat expectations, and Nvidia expects approximately 70% growth in fiscal 2028. Nvidia remains the main toll collector on Big Tech’s enormous AI budgets, capturing a large share of each new round of infrastructure spending.

“Blackwell Ultra drove the quarter, while Vera Rubin is already entering production. This smooth handover suggests the AI hardware upgrade cycle is accelerating without the pause some investors feared.

“The pressure point is profitability. Rising memory costs are expected to push gross margins down from 75% to 71%-72%. Nvidia’s ability to raise prices should help margins recover, showing considerable pricing power, but it cannot escape supply pressures entirely. AI demand remains exceptionally strong, while delivering that growth is becoming more expensive and capital-intensive.”