Nvidia shares jumped as much as 7.2% in premarket trading on Thursday after second-quarter revenue and earnings beat Wall Street estimates, lifting chipmakers and AI-linked stocks including Micron, Marvell and Arm. CEO Jensen Huang said AI demand has "reached its inflection point," while the company also agreed to buy Hugging Face for $12.9 billion.
Nvidia shares were last up 7.2% in premarket trading on Thursday, after the chipmaker's revenue guidance reassured investors that artificial intelligence demand will hold up. The move would let Nvidia buck a four-quarter streak of falling the day after earnings despite meeting or beating estimates.
Nvidia tops estimates on revenue and profit
Nvidia earned $2.22 per share after adjustments on $96.22 billion in revenue, against analyst consensus of $2.10 per share and $92.17 billion in revenue, according to LSEG. The company also guided for revenue to rise to $108 billion in the third quarter, above what analysts had expected.
Nvidia CFO Colette Kress said the company expects revenue growth of 70% for fiscal 2028, which runs from February 2027 to January 2028. Huang said demand runs well above that 70% figure, but the company remains constrained on how much product it can supply.
Chip stocks rally in Nvidia's wake
The earnings beat rippled across the sector. Micron rose 4.5%, Marvell 5.7%, Arm 4.7%, Intel 3% and Advanced Micro Devices 1.7%, while neocloud firms Nebius and CoreWeave were up around 7.5% and 6% in premarket trading, respectively.
Taiwan Semiconductor Manufacturing Co., Nvidia's main manufacturer, continues to face supply constraints, and memory chips also remain in short supply. Nvidia's AI Clouds, industrial and enterprise customer segment accounted for $40.3 billion in sales in the quarter, up 138% on an annual basis.
Huang cites AI's "inflection point"
Huang said the number of companies that need large clusters of GPUs has expanded dramatically, calling it an inflection point for the industry. According to CNBC: "I continue to be very bullish on Nvidia and this entire ecosystem," Paul Meeks, head of technology research at Freedom Capital Markets, said Thursday, adding he does not see a slowdown threat until 2028 at the earliest.
Even so, analysts on Thursday pointed to a threat to Nvidia's near-monopoly over the most advanced AI chips from custom semiconductors recently announced by hyperscalers and AI labs including OpenAI. Nvidia has also agreed to buy open-source platform Hugging Face for $12.9 billion, The Information reported, citing a person with knowledge of the deal.
Sources: US Top News and Analysis, US Top News and Analysis
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