- Nvidia Sees Adoption of AI-Driven GPUs Creating Long-Term Structural IT Transformation
- Jensen Huang rejects claims of AI bubble, citing infrastructure fundamentals
- The emergence of agentic AI will require significantly greater computing resources on a global scale
Nvidia CEO Jensen Huang has dismissed suggestions that the global AI market is currently in an economic bubble, instead arguing that current trends indicate fundamental changes in computing infrastructure.
During the company’s recent earnings conference call, Huang presented a three-pronged rationale for why AI is driving long-term investments in new systems rather than speculative hype.
He noted that the data processing, ad recommendations, search systems, and engineering industries are increasingly turning to GPUs because traditional CPU-based infrastructure cannot meet the demands of AI workloads.
New applications and agentic AI
Huang’s claims stand in stark contrast to those of Pat Gelsinger, former CEO of Intel, who believes the AI sector is in bubble territory, although this could happen gradually rather than suddenly.
Huang emphasized that AI is not only integrated into existing applications, but will also enable the creation of entirely new software capabilities.
He spoke of the emergence of “agentic AI,” capable of operating with minimal user intervention, reasoning autonomously, and planning complex tasks.
Such developments will require significantly greater computing resources, reinforcing the need for high-performance GPUs.
Huang said Nvidia is uniquely positioned to address all three categories of AI adoption, encompassing data-intensive workloads, new applications and autonomous AI operations.
“There has been a lot of talk about an AI bubble,” Huang said. “From our perspective, we see something very different. »
“When considering infrastructure investments, consider these three fundamental dynamics,” Huang said. “Each will contribute to infrastructure growth in the years to come.”
Nvidia reported revenue and profit that beat analysts’ expectations, with guidance also beating forecasts.
Huang recently predicted that AI chip sales could reach $500 billion by 2025 and 2026.
The company noted that its order book does not yet include agreements with organizations such as Anthropic or the expanded agreement with Saudi Arabia.
CFO Colette Kress confirmed that Nvidia remains on track to meet its revenue targets, highlighting strong demand for AI-based systems.
Investors have expressed concerns about reliance on a small number of hyperscalers, but Huang pointed out that Nvidia chips continue to boost revenue for cloud providers through AI-enhanced recommendation engines.
Huang believes the AI boom will increase traffic between enterprise systems, requiring greater inspection and monitoring capabilities.
AI tools and expanding data sets are driving this trend, and Nvidia expects infrastructure growth to continue as AI applications evolve.
The CEO stressed that what appears today as high capital expenditure reflects fundamental changes rather than speculative investments.
Huang concluded by saying that investors and operators need to consider these dynamics when evaluating the AI sector.
Nvidia views the adoption of AI-driven GPUs as a structural transformation in computing, signaling long-term growth potential beyond short-term market fluctuations.
By CNBC
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