- Nvidia sees AI-driven GPU adoption creating a long-term structural computing transformation
- Jensen Huang dismisses claims of an AI bubble, citing infrastructure fundamentals
- Agentic AI emergence will demand far greater computing resources globally
Nvidia CEO Jensen Huang has dismissed suggestions the global AI market is currently in an economic bubble, arguing instead that current trends point to fundamental changes in computing infrastructure.
On the company's recent earnings call, Huang outlined a three-pronged rationale explaining why AI is driving long-term investment in new systems rather than speculative hype.
He noted that industries handling data processing, ad recommendations, search systems, and engineering are increasingly turning to GPUs because traditional CPU-based infrastructure cannot meet the demands of AI workloads.
New applications and agentic AI
Huang’s assertions are in stark contrast to those of Pat Gelsinger, former CEO of Intel, who believes the AI sector is in bubble territory, though this could happen gradually rather than suddenly.
Huang emphasized AI is not only being integrated into existing applications but will also enable entirely new software capabilities.
He said the emergence of “agentic AI,” which can operate with minimal user input, reason autonomously, and plan complex tasks.
Such developments will require substantially greater computing resources, reinforcing the need for high-performance GPUs.
Huang stated that Nvidia is uniquely positioned to address all three categories of AI adoption, encompassing data-intensive workloads, new applications, and autonomous AI operations.
“There’s been a lot of talk about an AI bubble,” Huang said. “From our vantage point we see something very different.”
“As you consider infrastructure investments, consider these three fundamental dynamics,” Huang said. “Each will contribute to infrastructure growth in the coming years.”
Nvidia reported revenue and profits exceeding analysts’ expectations, with guidance also surpassing forecasts.
Huang recently projected that AI chip sales could reach $500 billion by 2025 and 2026.
The company noted its order backlog does not yet include deals with organizations such as Anthropic or the expanded agreement with Saudi Arabia.
CFO Colette Kress confirmed Nvidia remains on track to meet revenue targets, highlighting robust demand for AI-driven systems.
Investors have raised concerns about reliance on a small number of hyperscalers, but Huang stressed that Nvidia chips continue to boost cloud provider revenue through AI-enhanced recommendation engines.
Huang believes the AI boom will increase traffic across enterprise systems, requiring greater inspection and monitoring capabilities.
AI tools and expanding datasets are driving this trend, and Nvidia expects infrastructure growth to continue as AI applications scale.
The CEO stressed that what appears as high capital expenditure today reflects foundational shifts rather than speculative investment.
Huang concluded by asserting that investors and operators must consider these dynamics when evaluating the AI sector.
Nvidia views AI-driven GPU adoption as a structural transformation in computing, signaling long-term growth potential beyond short-term market fluctuations.
Via CNBC
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