Nvidia forecasts quarterly revenue above estimates

As AI is increasingly used to automate tasks and answer queries, Nvidia's graphics processors face growing competition from central processors and custom chips that are better suited to handle that process — known as inference. Rivals Intel and AMD are also targeting the inference market and several Chinese firms including Baidu already produce their own chips for such tasks. Nvidia has taken notice. In March, it unveiled a new central processor and AI system based on technology licensed from inference-focused startup Groq in a **$17 billion** deal, pairing Groq's chips with its upcoming Vera Rubin platform. The company's dominance as the AI market leader was reinforced earlier this month when SpaceX CEO Elon Musk said the rocket firm would exclusively use Nvidia's hardware. Nvidia has said the revenue opportunity for its AI chips could exceed **$1 trillion through 2027**, doubling from the **$500 billion** opportunity through 2026 that Nvidia cited for its Blackwell and Rubin chips. Nvidia forecasts quarterly revenue above Wall Street estimates on Wednesday, a sign that big technology companies are still spending heavily on its chips to power their AI ambitions, even as many of them race to build their own. The company expects third-quarter revenue of **$108.0 billion**, plus or minus 2%, compared with analysts' average estimate of **$104.19 billion**, according to data compiled by LSEG. Nvidia said it did not assume any data center chip sales from China in its outlook. Results from Nvidia, one of the world's most valuable firms, are considered a bellwether for the AI market as its chips power most of the major data centers and advanced AI models globally. The report comes weeks after companies including Microsoft and Meta — two of Nvidia's biggest customers — reinforced expectations that Big Tech would spend more than **$730 billion** on AI infrastructure this year, an unprecedented sum that marks a big step up from last year's **$400 billion** outlay. An increasing share of tech companies' slated spending is now, however, going towards in-house chip efforts that aim to reduce their reliance on Nvidia's costly and supply-constrained processors. Scrutiny has also mounted of Nvidia's role in the AI boom's complex financing ecosystem after it agreed to guarantee some deals under a new tie-up with six major financial institutions that aims to raise more than **$500 billion** for AI infrastructure.

Nvidia forecasts quarterly revenue above estimates

Inference market and rivals

Musk endorsement and long-term opportunity

Revenue outlook tops Wall Street estimates

AI spending remains strong, but competition is growing

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