"I don't believe we're in an AI bubble," says Huang after announcing $500B in orders:
On Wednesday, Nvidia became the first company in history to reach a $5 trillion market capitalization, fresh on the heels of a GTC conference keynote in Washington, DC, where CEO Jensen Huang announced $500 billion in AI chip orders and plans to build seven supercomputers for the US government. The milestone comes a mere three months after Nvidia crossed the $4 trillion mark in July, vaulting the company past tech giants like Apple and Microsoft in market valuation but also driving continued fears of an AI investment bubble.
Nvidia's shares have climbed nearly 12-fold since the launch of ChatGPT in late 2022, as the AI boom propelled the S&P 500 to record highs. Shares of Nvidia stock rose 4.6 percent on Wednesday following the Tuesday announcement at the company's GTC conference. During a Bloomberg Television interview at the event, Huang dismissed concerns about overheated valuations, saying, "I don't believe we're in an AI bubble. All of these different AI models we're using—we're using plenty of services and paying happily to do it."
Nvidia expects to ship 20 million units of its latest chips, compared to just 4 million units of the previous Hopper generation over its entire lifetime, Huang said at the conference. The $500 billion figure represents cumulative orders for the company's Blackwell and Rubin processors through the end of 2026, though Huang noted that his projections did not include potential sales to China.
While it probably feels like glory days for Nvidia at the moment, the success comes with a large dose of caution. Even prior to the latest valuation boom of the past 24 hours, the rapid rise in AI-related investments has fueled persistent concerns that market enthusiasm has outstripped the technology's ability to deliver immediate economic value.
Some analysts warn that valuations may be overheated. Matthew Tuttle, CEO of Tuttle Capital Management, told Reuters that "AI's current expansion relies on a few dominant players financing each other's capacity. The moment investors start demanding cash flow returns instead of capacity announcements, some of these flywheels could seize."
At the GTC conference on Tuesday, Nvidia's CEO went out of his way to repeatedly praise Donald Trump and his policies for accelerating domestic tech investment while warning that excluding China from Nvidia's ecosystem could limit US access to half the world's AI developers. The overall event stressed Nvidia's role as an American company, with Huang even nodding to Trump's signature slogan in his sign-off by thanking the audience for "making America great again."
Trump's cooperation is paramount for Nvidia because US export controls have effectively blocked Nvidia's AI chips from China, costing the company billions of dollars in revenue. Bob O'Donnell of TECHnalysis Research told Reuters that "Nvidia clearly brought their story to DC to both educate and gain favor with the US government. They managed to hit most of the hottest and most influential topics in tech."
Beyond the political messaging, Huang announced a series of partnerships and deals that apparently helped ease investor concerns about Nvidia's future. The company announced collaborations with Uber Technologies, Palantir Technologies, and CrowdStrike Holdings, among others. Nvidia also revealed a $1 billion investment in Nokia to support the telecommunications company's shift toward AI and 6G networking.
The agreement with Uber will power a fleet of 100,000 self-driving vehicles with Nvidia technology, with automaker Stellantis among the first to deliver the robotaxis. Palantir will pair Nvidia's technology with its Ontology platform to use AI techniques for logistics insights, with Lowe's as an early adopter. Eli Lilly plans to build what Nvidia described as the most powerful supercomputer owned and operated by a pharmaceutical company, relying on more than 1,000 Blackwell AI accelerator chips.
The $5 trillion valuation surpasses the total cryptocurrency market value and equals roughly half the size of the pan European Stoxx 600 equities index, Reuters notes. At current prices, Huang's stake in Nvidia would be worth about $179.2 billion, making him the world's eighth-richest person.
(Score: 3, Touché) by turgid on Monday November 03, @12:59PM (10 children)
At the GTC conference on Tuesday, Nvidia's CEO went out of his way to repeatedly praise Donald Trump and his policies... to keep himself out of the gulag. Just like that Zuckerberg guy did when the President for Life got elected.
And there's absolutely no bubble at all, no siree! What could possibly go wrong? What was it Mr Burns was invested in? Smithers, fetch my stock ticker.
I refuse to engage in a battle of wits with an unarmed opponent [wikipedia.org].
(Score: 4, Touché) by Thexalon on Monday November 03, @01:05PM
I mean, somebody who stands to gain huge gobs of money for as long as lots of people believe there is no bubble going on says there is no bubble going on. What rational person wouldn't believe him?
"Think of how stupid the average person is. Then realize half of 'em are stupider than that." - George Carlin
(Score: 5, Interesting) by khallow on Monday November 03, @01:12PM (3 children)
I think those are words to launch a hundred shareholder lawsuits. At least, Huang had the sense to cast it as a personal opinion.
As to the Trump praise, that might be an indication of how strongly this bubble depends on intervention by the US federal government - both to prop up the bubble and to bail out the participants when the party is over.
(Score: 4, Interesting) by VLM on Monday November 03, @02:36PM (2 children)
Anyone can sue anyone for any reason... the odds of success are very low:
1) I as in my personal opinion as a human, not as in the opinion of the board or my role as a "insert job title here". Good luck suing a corporate officer for going to church on Easter if you disagree with his personal religious opinions for example.
2) believe as in believe in santa clause or atheism or astrology. Uh huh.
3) "bubble" has no legal definition and what little consensus exists is stuff like the original tulip bulb bubble and this AI bubble is bad but clearly not THAT bad ... yet.
There's an entire corporate art in saying stuff that has no legal meaning. If he said "As (job title) my detailed financial analysis factually proves the target price next year could not mathematically be overvalued with a margin of precisely 123.4% based upon SOX certified financial statements approved by the auditors" well that is an issue if it doesn't work out. But no, "la de da I personally feel unicorns and frosting could be not as cute as glitter and balloons" is not a realistic winning lawsuit.
If you're bored you can access the free prospectus from public traded companies, its a master class in expressing a wild mixture of legally mandated facts right next to wild ass guesses and opinions surrounded by filler. Sometimes its possible to make money in the market by reading the footnotes, lot of history of that, LOL.
(Score: 1) by khallow on Tuesday November 04, @01:36AM
What if he's lying about his personal religious opinions in a scheme to bilk you (and a bunch of other people) of trillions of dollars? Does that change your opinion a little?
(Score: 1) by khallow on Tuesday November 04, @03:58AM
What I think will be the real obstacles will be: a) Huang is in a different country than most of the potential litigants. Much has been made of the "corporate veil" a legal thing that supposedly protects CEOs from anything. A better one is to simply not be in the jurisdiction where the lawsuit takes place. And b) when the bubble pops and Nvidia's stock collapses, there won't be much wealth to partition up even if the lawsuits win. That's the ultimate futility of shareholder lawsuits. You can have a great case and win that lawsuit, but your claim will be at the very end of the bankruptcy line.
(Score: 5, Funny) by driverless on Monday November 03, @01:13PM (3 children)
"'I don't believe we're in an AI bubble' says man set to make billions from AI bubble".
(Score: 2, Insightful) by Anonymous Coward on Monday November 03, @03:08PM (2 children)
It's not just an "AI" bubble. It's a Wall Street bubble. The entire thing is in a state of hyperinflation caused by all the quantitative easing that put trillions of dollars into circulation, and now trickling down to the retail markets
(Score: 0) by Anonymous Coward on Monday November 03, @07:11PM (1 child)
How does something based on trickle down get modded insightful.
I swear people just stopped thinking in 1980.
(Score: 0) by Anonymous Coward on Tuesday November 04, @07:00PM
:-) This is not the Trickle Down™ you're looking for. Market failures always trickle down and are billed to us
(Score: 2) by VLM on Monday November 03, @02:37PM
"please don't tariff my imports bro"
(Score: 5, Funny) by Sourcery42 on Monday November 03, @02:38PM
Every time someone says we're not in an AI bubble Jensen Huang's jacket gets a little bit shinier.
(Score: 2) by Username on Monday November 03, @02:45PM (1 child)
At this point why even have pci cards? Why not make large pcbs populated with all the "cores?" With the boards submerged in coolant, and a building sized cray waterfall for the esthetics.
(Score: 0) by Anonymous Coward on Monday November 03, @03:19PM
Wouldn't that be called an SBC?
(Score: 3, Insightful) by bzipitidoo on Monday November 03, @11:23PM (1 child)
Haven't we gotten used to lying CEOs? Hasn't their credibility sunk to near zero by now?
In the wake of the 2007-2008 market collapse, there's the famous confrontation between Jon Stewart and Jim Cramer. At one point, Cramer was nearly in tears, crying that "They (CEOs) lied to me!" And Stewart replied "Imagine that."
(Score: 0) by Anonymous Coward on Tuesday November 04, @07:12PM
Yes, we are quite comfortable with them, we go into debt to buy their junk that we don't need and reelect their handmaidens at every opportunity we have. Lying is obviously very good for business