Nvidia Forecasts 70% Sales Growth, Deflects Circular Financing Claims

Nvidia projected a 70 percent surge in fourth-quarter sales, signaling that the artificial intelligence boom continues to drive staggering demand for its chips. The forecast, which exceeded Wall Street expectations, sharply rebutted criticism that the company’s financing deals with AI startups rely on a circular funding model. The semiconductor giant now expects revenue of about $37.5 billion for the fiscal fourth quarter, far above analysts’ average estimate of $37.1 billion.

The company’s quarterly results for the period ending October 27 showed revenue of $35.1 billion, a 94 percent increase year over year. Net income more than doubled to $19.3 billion. Nvidia’s data center segment, which houses the chips essential for training large language models, generated $30.8 billion in revenue, up 112 percent from a year earlier. The company’s stock rose roughly 2 percent in after-hours trading following the announcement.

Nvidia’s performance underscores the unrelenting appetite for its graphics processing units, which have become the standard for running AI workloads. Major cloud providers such as Amazon Web Services, Microsoft Azure, and Google Cloud continue to invest heavily in Nvidia’s H100 and newer Blackwell chips. The company’s chief financial officer, Colette Kress, noted that supply chain improvements have allowed Nvidia to ship more chips than previously expected, easing constraints that had plagued customers for much of the past year.

The robust forecast also served as a direct retort to recent claims by short sellers and some analysts that Nvidia’s financing arrangements with AI startups amount to a circular funding scheme. In such deals, Nvidia provides capital to startups that in turn use that capital to purchase Nvidia chips, creating the appearance of demand. Kress dismissed these allegations, stating that the company’s investments represent standard venture capital practices and account for only a small fraction of overall revenue. She emphasized that the vast majority of Nvidia’s sales come from established customers with clear end-user demand.

Looking ahead, Nvidia acknowledged that geopolitical tensions remain a risk. The company’s chief executive, Jensen Huang, said export controls to China and other nations pose an ongoing challenge, though he expressed confidence that Nvidia’s product roadmap will continue to meet global demand. The company also indicated that its new Blackwell architecture, which promises significant performance gains over the current generation, is on track for volume shipments in early 2025.

For investors and policymakers, Nvidia’s report offers a clear window into the state of the AI investment cycle. The 70 percent growth forecast suggests that large-scale AI deployments are still in their early stages, with cloud providers and enterprises racing to build out infrastructure. Yet the circular financing debate highlights a deeper question: how much of this demand is organic versus manufactured by financial engineering? If a meaningful portion of Nvidia’s revenue relies on startups funded by the company itself, a slowdown in venture capital flows could hit Nvidia’s top line. For now, however, the data point to a market that still cannot get enough of Nvidia’s chips.