With data-center sales hitting $51.2 B and Q4 guidance at $65 B, Nvidia leaves bubble talk in the dust, even if some cautionary flags remain.

Nvidia: Revenues to the Moon

Nvidia’s third quarter of fiscal 2026 posted a record $57.0 billion in revenue, up 22 % from the previous quarter and 62 % from the year-ago quarter. Earnings per diluted share (GAAP and non-GAAP) were $1.30, well ahead of the roughly $1.26 Wall Street had forecast.

The standout: the data-center business, the beating heart of Nvidia’s AI growth engine, brought in $51.2 billion for the quarter. That is up 25% sequentially and 66% versus a year ago.

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Stock Reaction

Investors rewarded the performance: the stock jumped roughly 5 % after hours on the back of the beat and bullish guidance.

Why the pop? Two simple reasons: one, Nvidia delivered; two, they guided harder. For Q4 Nvidia expects revenue of $65 billion (±2 %) which is above most estimates of around $62 billion.

In other words: they didn’t just hit the target, they launched one further down the range.

That kind of outlook, aligned with ramping demand for AI infrastructure, gives the market reason to believe the investment cycle is not fading, at least not yet.

The AI Bubble: So Are We In It?

Bubble talk has been tearing through tech corridors lately. Some investors are nervous that all the hype around generative AI, chip build-outs and data-centers could be outpacing real-world outcomes.

But Nvidia’s tone? Calm and confident. CEO Jensen Huang addressed the concern directly:

Nvidia artificial intelligence
Jensen Huang, CEO of Nvidia, appears to have no fears of an AI bubble (Nvidia).

“There’s been a lot of talk about an AI bubble. From our vantage point, we see something very different.”

And from analysts:

“Fears of an AI bubble are way overstated,” wrote one. Their argument: with demand already stretching capacity (Nvidia says its chips are “sold out”), this isn’t a vanity build-up, it’s capacity meeting demand.

Still, let’s be honest: “just because you don’t see the bubble yet doesn’t mean it can’t burst.” Risks include overheating capex, supply bottlenecks, customer concentration, alternative architectures (other chip makers), and macro weakness.

Implications for the AI Industry

· Infrastructure build-out is real: Nvidia’s results suggest cloud providers and hyperscalers are doubling down on AI compute rather than pulling back.

· Nvidia further entrenches itself as the “platform” of AI: With Blackwell architecture and data-center dominance, they’re moving from chip vendor to essential infrastructure provider.

· Ecosystem impact spreads: Strong Nvidia numbers tend to lift peers (chips, servers, cloud), boost confidence in AI cycles across industries and regions.

· Valuation scrutiny continues: The strong performance gives runway, but with valuations already stretched, expectations will remain high. One quarter of “just good” won’t cut it.

· Geopolitical/regulatory undercurrent remains: Restrictions on exports to China or other jurisdictions could bite. Nvidia mentioned disappointment that purchase orders to China were not fulfilled “due to geopolitical issues” when discussing guidance.

Going Forward

If you were looking for evidence that the AI investment wave is more than hype, this quarter from Nvidia offers a compelling case. The numbers are not just “better than expected” — they are structurally strong.

But the flipside: when a company becomes the poster child for a trend, the pressure to deliver intensifies. If the next quarter (or the one after) comes in flat, the mood could shift fast.

Look at chip pipeline, end-customer saturation, capex growth versus actual revenue growth, margin trends, and geographic diversification.

Nvidia didn’t just beat expectations, it bulldozed them. The “bubble” alarms are paused, if not silenced. For now, the AI boom has another solid quarter behind it, with Nvidia very clearly at its center. That doesn’t mean there’s no risk, but it does mean the build-out is underway and not a figment of investors’ imaginations.

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Source: Finance Magnates