AI boom to create multi-trillion-dollar market by 2030: NVIDIA CEO
What's the story
NVIDIA CEO Jensen Huang has dismissed concerns over the end of a spending boom on artificial intelligence (AI) chips. He predicts that opportunities in this sector will grow into a multi-trillion-dollar market within the next five years. Huang's optimistic outlook comes as NVIDIA forecasts third-quarter revenue in line with analyst estimates, though these estimates fall short of the lofty expectations that have contributed to its share price rising by nearly one-third this year.
Market projection
Huang's prediction of an AI revolution
Huang envisions a new industrial revolution with an "AI race" underway. He estimates that by the end of this decade, there will be $3 trillion to $4 trillion in AI infrastructure spending. This prediction is bolstered by anticipated demand from Big Tech companies, hyperscalers (data center owners), and China. Matt Orton, head of advisory solutions at Raymond James Investment Management, noted that these mega-caps are driving much of the capital expenditure benefiting NVIDIA.
Market resilience
Despite AI stock fatigue, Huang remains optimistic
Despite signs of fatigue in AI-facing stocks and OpenAI CEO Sam Altman's warning that investors may be "overexcited" about AI, Huang remains confident. He said, "The more you buy, the more you grow," emphasizing NVIDIA's technological advances enable customers to process more data with less energy. He also revealed a customer outside China purchased $650 million worth of NVIDIA's H20 reduced-capability chip for the Chinese market in the latest quarter.
Spending forecast
Data center capital spending projections
Huang's market projection is also based on an expected $600 billion in data center capital spending this year from major customers like Microsoft and Amazon. He said NVIDIA can capture about $35 billion from a data center costing as much as $60 billion. This prediction contrasts with a third-quarter revenue forecast that is slightly ahead of the $53.14 billion average of analyst estimates compiled by LSEG.
Chip demand
Hyperscalers' demand signals early stages of AI boom
NVIDIA's high-end Blackwell chips are mostly sold out, according to 2026 forecasts from its biggest customers. Earlier-generation Hopper processors are also being snapped up. Globalt Investments portfolio manager Thomas Martin said this rapid growth and massive capital expenditure announcements from hyperscalers indicate that we are still in the early stages of the AI boom.