For the past week, global markets have behaved like someone slowly realising they may have overpaid for the world’s most hyped gadget.
A 3% slide in the tech-heavy Nasdaq, hand-wringing over whether AI stocks have become dangerously inflated, and high-profile selling (Peter Thiel dumping $100 million of Nvidia shares and SoftBank delicately trimming its own holding) all fed a growing sense that the AI party might be losing its fizz.
Then Nvidia Corp (NASDAQ:NVDA, XETRA:NVD) reported earnings. And just like that, the mood flipped.
Shares surged 5% after hours, adding a barely believable $230 billion to the company’s value. That's within a gnat's whisker of the market capitalisation of AstraZeneca, Britain's most valuable company.
For UK savers with ISAs and SIPPs stacked with global tech funds, the sense of relief was palpable.
And that relief was earned. Nvidia didn’t merely clear the high bar set for it; it sailed over it, whistling.
A quarter that blew away even the optimists
Revenue jumped 62% to $57 billion. Profit leapt 65% to $32 billion. Both numbers comfortably beat Wall Street expectations — but it is the detail that explains why the shares erupted.
Nvidia’s data centre division, the nerve centre of the global AI race, posted $51.2 billion in revenue, 25% higher than just three months ago and up 66% on last year.
Put another way: nearly every major AI model, chatbot, image generator, autonomous agent and research lab on the planet is powered by Nvidia hardware, and that demand is compounding at speed.
Chief financial officer Colette Kress said the quarter included AI infrastructure announcements equating to an eye-watering 5 million GPUs.
These aren’t hypothetical projects; cloud providers, sovereign governments and fast-growing AI start-ups are signing up at pace.
The star of the show? Nvidia’s Blackwell chips are the latest generation of GPUs designed for the most advanced AI workloads. Jensen Huang, Nvidia’s founder and chief executive, put it bluntly: “Blackwell sales are off the charts, and cloud GPUs are sold out.”
That is not the language of a market losing steam.
The bubble question
Investors have been spooked by comparisons to the dotcom boom of the late 1990s, when enthusiasm outran reality and the crash that followed was brutal.
Even big-name figures in the sector have expressed caution: Google’s Sundar Pichai recently said there is “irrationality” in parts of the AI investment wave.
Wall Street analysts drew parallels with the period before the dotcom crash, warning that while core platforms are strong, the wider ecosystem includes many unprofitable companies.
So when Nvidia itself acknowledges valuations are stretched, people listen.
But this time, instead of feeding that anxiety, Huang extinguished it, at least temporarily.
“There’s been a lot of talk about an AI bubble. From our vantage point, we see something very different,” he told analysts.
In his view, AI demand is accelerating, not cooling. Both training and inference, the two workloads that drive GPU usage, are “each growing exponentially”. The phrase he used is telling: “We’ve entered the virtuous cycle of AI.”
That kind of language will divide opinion. Bulls will see it as confirmation that Nvidia is the central infrastructure supplier of a once-in-a-generation technological shift. Sceptics will see it as precisely the sort of rhetoric that characterises late-stage bubbles.
But the numbers back Huang up... at least for now.
A blemish from China
Not everything was perfect. The company’s H20 chip, a data centre GPU designed to comply with US export restrictions on advanced AI technology, shipped around 50 million units, well short of expectations.
Kress blamed “geopolitical issues and the increasingly competitive market in China”, alongside unmaterialised purchase orders.
The message was clear: China remains both a tantalising opportunity and a regulatory minefield. Nvidia insists it is working with US and Chinese authorities to find a path forward, but this will remain a structural risk.
Why UK investors should care
Nvidia is now the world’s most valuable company, and many UK investors own a slice of it, whether they realise it or not.
Any global tech tracker, AI fund, US growth ETF or diversified pension allocation will include Nvidia, and often in hefty amounts.
When Nvidia moves, portfolios move.
And Wednesday’s results show why it holds that weight: this is a company delivering growth at a scale no other business on the planet can match right now.
The bottom line
Nvidia’s quarter doesn’t eliminate bubble worries. Nor does it guarantee the share price has unlimited room to run. But it does answer the most important question facing the market: Is demand for AI infrastructure slowing?
Based on Nvidia’s numbers, the answer is a resounding no.
The real tension now is whether the rest of the AI ecosystem can keep pace, or whether Nvidia will continue to be the exception that props up the entire narrative.