Nvidia Corp. gave a bullish revenue forecast for the current quarter, bolstering confidence that the world’s most valuable chipmaker can keep its business thriving by focusing on gear that powers artificial intelligence.
Sales in the three months ending in July will be about $11 billion, Nvidia said in a statement Wednesday. That shattered an average analyst estimate of $7.18 billion, sending the shares soaring in late trading.
The outlook shows that Nvidia is benefiting from the booming demand for AI services. Under Chief Executive Officer and co-founder Jensen Huang, the company has positioned itself as the top provider of components for training artificial intelligence software. That’s helped it weather a broader slowdown in technology spending.
Shares of Santa Clara, California-based Nvidia rose 15% in extended trading after closing at $305.38.
The stock has outperformed gains by others in the major indices it trades on, making it the world’s fifth-largest publicly traded company this year. Nvidia’s market value has swelled to $755 billion. By that measure, the chipmaker is more than six times the size of Intel Corp., a company that had more than twice Nvidia’s annual revenue last year.
Investors have singled out Nvidia as one of the big potential winners in AI, following the viral success of the ChatGPT chatbot and other popular tools. The company’s chips excel at parallel processing, which makes them well suited for training software by bombarding it with data.
Nvidia’s Huang has argued that the use of the technology is only in its infancy and more tailored products for specific industries are needed. He’s built online services and software tools to help encourage the broader adoption of AI outside of his big customers — cloud providers like Microsoft Corp. and Amazon.com Inc.’s AWS.
