Nvidia (NVDA) shares soared over 7% on Thursday after the chipmaker’s longer-term revenue outlook reassured investors that demand for artificial intelligence infrastructure remains strong despite concerns over spending, financing and competition.
The rally could also help Nvidia break a recent pattern. The stock, trading at around $226, is also just below its all-time high of $236.54.
The stock has fallen the day after earnings in each of the previous four quarters, even when the company met or exceeded Wall Street expectations.
Nvidia sees 70% growth in fiscal 2028
Nvidia CFO Colette Kress said Wednesday that the company expects revenue to grow 70% in fiscal 2028, which runs from February 2027 through January 2028.
The forecast implies revenue of at least $690 billion, compared with the prior Street estimate of $573.5 billion, according to Benchmark analyst Cody Acree.
CEO Jensen Huang said actual demand is substantially stronger than the company’s forecast, but supply constraints are limiting how much Nvidia can ship.
Huang said Nvidia has never previously provided a revenue forecast a year ahead, but added that the company now has greater visibility across its supply chain.
That visibility is particularly important as Nvidia continues to face constraints in advanced manufacturing and components.
Taiwan Semiconductor Manufacturing Co., its primary manufacturing partner, remains capacity constrained, while memory chips used in Nvidia’s systems are also in short supply.
Analysts remain firmly bullish on Nvidia stock
Analysts see further upside if Nvidia can expand supply to meet stronger-than-expected demand.
Benchmark reiterated a Buy rating and $335 price target following Nvidia’s updated outlook.
Acree said the difference between demand and the supply-backed guidance creates room for the company to raise estimates further.
“We believe the difference between the demand signal and the supply-backed guide creates unusual execution room for further estimate upside even from a quarterly revenue base approaching $100B,” Acree said.
UBS also raised its price target to $300 from $280 while maintaining a Buy rating.
Analyst Timothy Arcuri said Nvidia’s results were strong and its guidance was consistent with the firm’s expectations.
UBS said the company’s calendar 2027 outlook implies earnings per share above $16, even with near-term pressure on gross margins from higher memory prices.
Raymond James was even more bullish, raising its price target to $515 from $352 while maintaining a Strong Buy rating.
The firm pointed to Nvidia’s second-quarter results and its third-quarter and fiscal 2028 outlook, all of which exceeded expectations.
It also highlighted architectural changes including LPU-NVL racks and Vera CPU systems as potential drivers of further growth.
AI spending concerns remain
Nvidia’s outlook comes as investors continue to question whether massive AI capital expenditures can generate sufficient returns.
Concerns have also focused on financing arrangements in which Nvidia supports companies that subsequently spend money on Nvidia’s chips, raising questions about the sustainability and circularity of some AI infrastructure investments.
Huang’s comments appeared to ease some of those concerns by emphasizing that demand is coming from a much broader group of customers.
AI development has expanded beyond a handful of major labs, with startups, frontier model developers, open-source projects and physical AI companies all building increasingly large computing clusters.
“This time last year, one lab alone was driving the build-out,” Huang said.
“Today, we have a golden age of new AI labs and startups, multiple frontier labs scaling in parallel, a thriving open-model ecosystem and physical AI coming online.”
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