Nvidia, which leads the artificial intelligence (AI) chip market, set another record for quarterly revenue in the third quarter. It also issued fourth-quarter sales guidance that far exceeded market expectations, directly rebutting recent concerns about an "AI investment slowdown." Chief Executive Jensen Huang stressed that "the AI industry has entered a virtuous cycle," and Nvidia shares rebounded in after-hours trading immediately after the results.
Nvidia released third-quarter results for fiscal year 2026 (August–October) on the 19th (local time), reporting revenue of $57.006 billion. That was up 22% from the previous quarter and 62% from a year earlier, the highest ever for a quarter. Data center revenue came in at $51.2 billion, beating the market estimate of $49.3 billion and driving the overall results. Adjusted EPS (earnings per share) was $1.30, topping the consensus of $1.25.
Fourth-quarter revenue guidance was presented at $65 billion (±2%). That far exceeds the market forecast of $62 billion, and the company expected to maintain high profitability with a gross margin of 75% (±0.5%). Huang said, "Blackwell shipments are off the charts, and cloud GPUs (graphics processing units) are completely sold out," adding, "A virtuous cycle in which AI training and inference accelerate each other's demand has already formed."
Nvidia also stressed that the latest results were achieved essentially "without China sales." The company said third-quarter revenue from its H20 chip for China compliance was "not meaningful." Still, the point bolsters the view that global AI investment remains solid.
On the third-quarter earnings conference call, Huang projected that revenue based on Blackwell and the next-generation GPU "Rubin" would reach a total of $500 billion by the end of 2026. "Data center revenue topped $50 billion this quarter, but this is just the beginning," he said. "We are executing that roadmap without a hitch." He also argued that the AI infrastructure market will expand to $3 trillion to $4 trillion, and that Nvidia could capture more than half of it.
Nvidia also emphasized that its customer base expansion is accelerating. Beyond hyperscalers such as Amazon, Microsoft, Google and Oracle, demand is broadening to model developers including OpenAI, Anthropic and xAI; enterprise software corporations such as Palantir, SAP, ServiceNow and Salesforce, Inc.; and manufacturers and Robotics companies including Foxconn, Renova, Toyota and Amazon Robotics. Huang said, "The market is not limited to big tech. Customers are expanding across all industries, from governments in each country to Autonomous Driving companies and bio Start - Up firms."
He also pushed back on questions about depreciation burdens and debate over GPU lifespans. "Nvidia GPUs are not hardware but systems based on the CUDA ecosystem," Huang said, adding, "Even the A100, launched six years ago, is still utilized at 100% thanks to optimizations in the latest libraries." On Blackwell's high price, he explained, "Considering cost per performance and cost per watt, it actually significantly reduces TCO (total cost of ownership)."
On concerns about supply chain bottlenecks, he said, "We are working closely with TSMC, SK hynix and Micron to massively expand production capacity," noting that the pace of supply growth is improving rapidly. Regarding potential competition with ASICs (application-specific integrated circuits) that could replace the company's GPUs, he drew a line: "We provide a system that integrates racks, switches, cooling and software, not just chips," adding, "There is effectively no ASIC that can replace the versatility of GPUs."
Nvidia shares rose 2.85% to close at $186.52 on the day, and in after-hours transaction after the earnings release, they surged nearly 6% to break above $197. By contrast, rival AMD fell nearly 3% on concerns about Nvidia's deepening dominance. Related theme stocks in AI Semiconductor, power infrastructure, Robotics and quantum computers also showed strong gains together.
Some, however, note that external variables such as China export controls and intensifying competition remain risks. Gene Munster of Deepwater Asset Management said, "If Nvidia's guidance rises too high, it could actually fuel concerns about AI overinvestment," adding, "In the near term, investor reactions are hard to predict."