Nvidia Sees Fiscal 2028 Revenue Rising About 70%, Brushing Off AI Spending Slowdown Fears

Nvidia forecast about 70% revenue growth for fiscal 2028, brushing aside market concerns that spending on artificial intelligence may be starting to cool.

Bloomberg reported on Aug. 26 that Chief Financial Officer Colette Kress told investors on a conference call after the company’s second-quarter earnings release that revenue in fiscal 2028 would rise about 70%. That is far above the roughly 45% consensus estimate compiled by Bloomberg. Kress added that growth would have been faster with more supply capacity and said customer outlooks suggest the pace could accelerate further next year.

The company also beat market expectations for the quarter. Revenue for the second quarter ended July 26 more than doubled from a year earlier to $96.2 billion, topping the $92.5 billion estimate. Adjusted earnings per share were $2.22, ahead of the $2.09 forecast. Revenue from the core data-center business came to $89 billion, exceeding the $85.8 billion estimate.

Nvidia forecast current-quarter revenue of $108 billion, plus or minus 2%, above the market estimate of $105.2 billion. It projected gross margin of about 74%. Chief Executive Officer Jensen Huang said the buildout of AI infrastructure is moving at full speed and that Vera Rubin, the company’s latest family of AI chips, has entered full-scale production.

Markets have recently questioned whether heavy AI spending can be sustained. Nvidia’s series of investment agreements with AI companies has also drawn criticism that circular financing may be creating artificial demand. The company, however, argues that broader AI adoption will generate additional demand for its products.

Still, a shortage of memory chips and efforts by large technology companies to develop their own AI chips remain key variables. Demand for memory used in AI computing has surged, pushing up prices, and Nvidia has raised prices on some products to reflect higher costs. Expanding in-house chip development by Nvidia’s major customers is also a long-term competitive factor.

Nvidia shares rose more than 4% in after-hours trading following the earnings release.