Jensen Huang Just Delivered Incredible News for Nvidia Stock Investors
News Summary
Nvidia CEO Jensen Huang announced significant demand for the company's most advanced Blackwell and Rubin GPUs at the GTC conference in Washington, D.C. Nvidia has secured $500 billion in orders for 20 million GPUs through 2026, with six million already shipped. The remaining $350 billion in orders are expected to generate $70 billion per quarter over the next five quarters, significantly exceeding Nvidia's Q2 FY2026 total revenue of $47 billion. Despite losing its 20-25% share of the Chinese data center market due to U.S. export restrictions, Nvidia continues to thrive. The company is also partnering with Oracle and the U.S. Department of Energy to build seven AI supercomputers, including the massive Solstice system with 100,000 Blackwell GPUs, to advance scientific discovery and AI research. Nvidia has achieved over 50% year-over-year revenue growth for nine consecutive quarters, with nearly 90% of its revenue now derived from data centers. Although its valuation is currently high, the substantial order backlog makes the stock appear more reasonably priced.
Background
Nvidia, a global leader in graphics processing units (GPUs), holds a dominant position in artificial intelligence (AI) computing, with its chips widely used in data centers, high-performance computing, and AI training. The company has been a key player in the tech industry for decades and became a central focus of the market amidst the explosive growth of AI in the mid-2020s. In 2025, the U.S. government imposed strict export restrictions on advanced AI chips to China, resulting in Nvidia losing a significant share of its Chinese data center market. Despite these geopolitical challenges, Nvidia has continued to innovate and expand collaborations with U.S. governmental bodies to solidify its leadership in the global AI infrastructure landscape.
In-Depth AI Insights
Does Nvidia's staggering $500 billion order book represent a 'last hurrah' before a potential AI bubble burst? - While impressive, such concentrated demand might signify the initial frenzy of AI infrastructure buildout rather than a sustainable, steady growth pattern. Once initial deployments are complete, demand growth could decelerate. - Investors must scrutinize the nature of these orders: are they concentrated purchases from a few hyperscalers, or broad-based industry demand? Over-reliance on a few key customers increases risk. - Historical tech cycles often feature periods of elevated valuations; massive orders might be overinterpreted by the market as sustained growth rather than a burst of demand in a specific phase. What deeper strategic implications does the U.S. government's partnership with Nvidia hold, especially given the restrictions in the Chinese market? - This extends beyond mere commercial collaboration; it's a manifestation of the U.S. government's 'chip nationalism' strategy, aiming to secure critical AI infrastructure and technology under American control. - Partnering with agencies like the Department of Energy helps Nvidia offset losses in the Chinese market and build new moats in national security and scientific research, reinforcing its indispensability. - This could also incentivize other nations to accelerate the development of their indigenous AI chip industries to reduce reliance on Nvidia and U.S. technology, potentially leading to market fragmentation long-term. What potential mismatches or underappreciated risks exist between Nvidia's current valuation and its future growth expectations? - Despite the huge order backlog, a price-to-sales (P/S) ratio of 55 remains at a historical high, indicating that the market has priced in extremely aggressive growth expectations. - Key risks include a potential slowdown in AI spending or accelerated technological iteration. If the next generation of AI chips isn't dominated by Nvidia, or if customers begin seeking alternatives, its market position could be challenged. - Furthermore, ongoing uncertainty regarding U.S. government AI chip export policies and potential global economic volatility could pose threats to Nvidia's long-term revenue stability.