Jen-Hsun Huang did not see the bubble.

Amidst the external turmoil, Nvidia's earnings report was released, and the stock price still rose.

This is quite an impressive financial report, as both the overall quarterly revenue and profit, as well as the performance of the core business data center, are very strong. Huang Renxun also stated that NVIDIA has $500 billion in undelivered chip orders, and all cloud GPUs are sold out.

Most notably, Jensen Huang responded to external concerns about an AI bubble during the conference call, stating that he does not see a bubble existing.

NVIDIA's recent financial report release has garnered significant attention, with a crucial factor being the external divergences. On one side, there are large short positions typified by the character Beri from “The Big Short”; on the other side, there is optimism and buying represented by the investment bank DA Davidson, which previously shorted NVIDIA.

Nvidia is thus caught between polarized judgments. It seems that the outside world has found it difficult to reach a consensus on Nvidia's prospects and the future of the entire AI industry.

01

First, let's take a look at Nvidia's financial report.

NVIDIA released its third quarter financial report for the fiscal year 2026, ending October 26 this year.

The entire financial report exudes positivity, with revenue and profits exceeding analysts' expectations in various aspects. On this basis, the company also maintains an optimistic outlook for the future.

The financial report shows that NVIDIA's revenue for the third fiscal quarter was $57.01 billion, far exceeding analysts' estimate of $54.92 billion; the company's net profit reached $31.91 billion, with a year-on-year rise of 65%.

After adjustments, Nvidia's earnings per share for the third fiscal quarter is $1.30, while the previous market estimate was $1.25.

In terms of business, the data center remains a pillar for Nvidia, and this time its performance has once again set a historical high.

In the third quarter, data center revenue reached $51.2 billion, accounting for nearly 90% of total revenue, which is a year-on-year increase of 66%, far exceeding analysts' estimate of $49 billion. Among the data center business, the “computing” segment accounted for a large portion, contributing $43 billion in revenue.

The growth in this segment is primarily driven by the sales of the GB300 series chips. The GB300 is NVIDIA's next-generation artificial intelligence computing platform, equipped with 72 Blackwell Ultra AI GPUs and 36 Grace CPUs based on the Arm Neoverse architecture, which was officially announced in May of this year and will enter mass production in the third quarter.

During the conference call, NVIDIA's Chief Financial Officer Colette Kress revealed: “Sales of GB300 have surpassed those of GB200, contributing approximately two-thirds of Blackwell's total revenue. The transition to GB300 has been very smooth.”

In addition to “computation”, the “network” business also contributed $8.2 billion in revenue in the data center sector.

According to the financial report, in the third quarter of the fiscal year 2026, although other businesses of NVIDIA accounted for a small proportion, they also all “have joy”. For example, the quarterly revenue from the gaming business was $4.3 billion, a year-on-year increase of 30%; the professional visualization business generated $760 million in revenue, a year-on-year increase of 56%; and the automotive and robotics business contributed $590 million in revenue, a year-on-year increase of 32%.

To understand how crazy all of this is, take a look at the wave of AI before it. In November 2022, three full years ago, Nvidia released its financial report for the third quarter of fiscal year 2023, with quarterly revenue of $5.93 billion, a year-on-year decline of 17%. In other words, in three years, Nvidia's quarterly revenue has ballooned to ten times its size.

It can also be said that three years ago, all of Nvidia's revenue was equivalent to about 10% of its current income, excluding its core data center business.

02

As soon as NVIDIA's financial report was released, the market responded positively, with the after-hours stock price rising by more than 5%.

This is not easy; NVIDIA's latest financial report has attracted significant attention, primarily because concerns about the artificial intelligence bubble have reached unprecedented heights.

The judgment on Nvidia's future has shown a polarized state.

On one hand, many institutions are optimistic about Nvidia, choosing to buy in or giving positive expectations.

The most dramatic event was when investment bank DA Davidson suddenly upgraded Nvidia's rating from “Hold” to “Buy” and raised its target price from $195 per share to $210 per share.

This is a huge shift in attitude; DA Davidson was previously bearish on Nvidia, and its analysts had warned that Nvidia's stock price could plunge by as much as 48%.

In a new report, DA Davidson stated: “Our increasingly optimistic view on the growth of artificial intelligence computing demand has replaced our concerns about Nvidia.”

On the other hand, opposing voices are also everywhere.

The most attention was drawn to Michael Burry, the character from the film “The Big Short,” and his firm, Scion Asset Management, which has heavily shorted Nvidia.

Burry himself also broke a two-year silence by posting on X, with an image of his character from “The Big Short” staring at a computer. The caption reads: “Sometimes, we can see the bubble. Sometimes, we can take action. Sometimes, the only way to win is not to participate.”

Although he did not explicitly state what the “bubble” here refers to, it is widely believed to refer to the AI bubble.

Burry is not necessarily correct. He successfully predicted the subprime mortgage crisis back then, but he also warned a few years ago that meme stocks and cryptocurrency buyers would face a “century crash,” and Musk mocked him as a “broken clock” that always signals the wrong time.

But who can ignore the signal that has sounded this time? Especially now, as the AI bubble theory intensifies, NVIDIA, as the “nucleus” of the entire Silicon Valley AI industry, is under the spotlight for every move it makes.

03

Nvidia naturally has to face the external controversies. During this earnings call, questions regarding the AI bubble inevitably came to the forefront.

Jensen Huang neither avoided nor beat around the bush, but directly gave a negative attitude:

“There are many claims about the AI bubble, but from our perspective, the situation is completely different compared to the internet bubble period. AI is changing existing workloads, and we do not see the existence of an AI bubble.”

NVIDIA's confidence lies in the strong sales of GPUs. In the financial report, Jensen Huang stated that sales of the Blackwell chips far exceeded expectations, and cloud GPUs are completely sold out. “Whether it is training or inference, the demand for computing power is accelerating and growing exponentially. We have entered a virtuous cycle of AI.”

In the conference call, he revealed that Nvidia currently holds $500 billion in undelivered chip orders, with schedules extending to 2026, including the next-generation Rubin processor that will go into mass production next year.

According to Huang Renxun, the artificial intelligence ecosystem is rapidly expanding, giving rise to more new foundational model builders and more AI startups, covering more industries and more countries. AI is everywhere and capable of anything. Therefore, concerns about an AI bubble are largely unnecessary.

NVIDIA is also confidently providing an optimistic forecast for the future.

NVIDIA expects revenue of approximately $65 billion in the fourth quarter, exceeding analysts' expectations of $61.66 billion.

The after-hours performance of Nvidia's stock also indicates that the company's earnings report, including the performance during the conference call, has alleviated the market's nervousness to some extent.

Investing.com senior analyst Thomas Monteiro commented: “This answers many questions about the current state of the artificial intelligence revolution, and the conclusion is simple: in the foreseeable future, artificial intelligence has not yet reached its peak in terms of market demand or production supply chain.”

But that does not mean that the tension will immediately dissipate.

Some analysts say that this earnings report may not be enough to quell concerns about the artificial intelligence bubble.

NVIDIA significantly increased its investment in leasing its own chips in the third fiscal quarter in order to lease them back from cloud customers who are unable to rent out the chips. The total amount of such contracts reached $26 billion, doubling from the previous quarter.

Cloud giants, including Microsoft and Amazon, are investing billions of dollars into AI data centers. Some investors believe that these companies are “artificially inflating” profits by extending the depreciable life of AI computing devices, such as NVIDIA chips.

In the third fiscal quarter, Nvidia's business concentration further increased, with four major customers contributing 61% of sales, up from 56% in the previous quarter.

The company is also continuously increasing its investment in artificial intelligence companies, pouring billions of dollars into enterprises that are often also its important clients, raising concerns about the “AI economic cycle dependency.”

In addition, there are many uncontrollable factors that may limit Nvidia. For example, the influence of geopolitics, it is still excluded from the Chinese market and is now targeting the Middle East, having recently been approved to export chips worth up to $1 billion there.

For example, the actual utilization issue of future GPUs. eMarketer analyst Jacob Bourne stated:

“Despite the enormous demand for GPUs, investors are increasingly concerned about whether the hyperscale cloud providers can actually utilize this computing power quickly enough. The key question is whether physical bottlenecks such as power, land, and grid access will limit how quickly this demand can translate into revenue growth in 2026 and beyond.”

The debate surrounding the AI bubble and Nvidia's future will continue.