NVIDIA Sees 62% Revenue Jump in Q3, Avoiding Stock Market Meltdown

Wall Street breathed a sigh of relief today as NVIDIA reported record Q3 revenue of $57B – beating estimates and representing a rise of 22% from the previous quarter and 62% from last year. 

NVIDIA is the world’s most valuable company, which has also become a bellwether for the AI industry – and, arguably, the global economy as a whole. It reported its first acceleration in sales in seven quarters, providing a boost to the tech sector amid longstanding fears of an AI bubble. 

NVIDIA Q3 Results Explained

The chipmaker’s shares jumped 5% in extended trading amid the results, which saw sales in the company’s data-centre segment – which makes up a majority of NVIDIA revenue – growing to $51.2B in the quarter ended October 26. Analysts had expected sales of $48.62B, according to Reuters.

Fourth-quarter sales are seen at $65B, plus or minus 2 – beating analyst estimates of $61.66B, according to data from LSEG.

Just four customers made up for 61% of sales in Q3, up from 56% in Q2, showing signs that the business has become even more concentrated. 

NVIDIA CEO Jensen Huang played down fears of an AI bubble amid the demand for the company’s chips, saying: “From our vantage point, we see something very different.”

Huang said: “Blackwell sales are off the charts, and cloud GPUs are sold out. Compute demand keeps accelerating and compounding across training and inference – each growing exponentially. 

“We’ve entered the virtuous cycle of AI. The AI ecosystem is scaling fast – with more new foundation model makers, more AI startups, across more industries, and in more countries. AI is going everywhere, doing everything, all at once.”

During the first nine months of fiscal 2026, NVIDIA returned $37B to shareholders in the form of shares repurchased and cash dividends. As of the end of the third quarter, the company had $62.2B remaining under its share repurchase authorization.

NVIDIA will pay its next quarterly cash dividend of $0.01 per share on December 26, 2025, to all shareholders of record on December 4, 2025.

Outlook for the fourth quarter of fiscal 2026 is as follows:

• Revenue expected to be $65B, plus or minus 2%.
• GAAP and non-GAAP gross margins expected to be 74.8% and 75.0%, respectively, plus or minus 50 basis points.
• GAAP and non-GAAP operating expenses are expected to be approximately $6.7B and $5B, respectively.
• GAAP and non-GAAP other income and expenses are expected to be an income of approximately $500M, excluding gains and losses from non-marketable and publicly-held equity securities.
• GAAP and non-GAAP tax rates are expected to be 17%, plus or minus 1%, excluding any discrete items.

“AI Is Going Everywhere, Doing Everything, All at Once”

There had been fears that negative results – or even, results which are not positive enough – would cause stock disruption and confirm long-held fears that AI is a bubble waiting to burst. 

Some analysts believe the results will not quell fears of a bubble, pointing to concerns that AI infrastructure spending growth is not sustainable, as well as circular financing in the sector.

Nvidia had $26B in contracts to rent back its own chips from its cloud customers, who otherwise cannot rent them out, more than doubling from the previous quarter, Reuters reports. 

In the latest press release, NVIDIA announced a strategic partnership with OpenAI to deploy at least 10 gigawatts of its systems for OpenAI’s AI infrastructure, alongside other collaborations with Google Cloud, Microsoft, Oracle and xAI, aiming to “build America’s AI infrastructure with hundreds of thousands of NVIDIA GPUs”.

Anthropic will also, for the first time, run and scale on NVIDIA infrastructure, initially adopting 1 gigawatt of compute capacity with NVIDIA Grace Blackwell and Vera Rubin systems.

NVIDIA unveiled plans to accelerate seven new supercomputers, including one with Oracle to build the U.S. Department of Energy’s largest AI supercomputer, Solstice, featuring 100,000 NVIDIA Blackwell GPUs, plus another system, Equinox, featuring 10,000 NVIDIA Blackwell GPUs.

Salesforce Ben founder Ben McCarthy said: “I’m pretty bullish on AI, and it really is nothing compared to the dotcom bubble, where technology wasn’t understood. Adoption of the internet wasn’t a thing, so all these crazy valuations for websites that didn’t have a plan to make money were warranted.

“However, this is completely different. ChatGPT, as we know – and I haven’t heard anyone mention it for a while – was the fastest adopted app ever, due to the internet being the delivery mechanism.

“Yes, valuations are probably too high, but stock prices are speculative, and as we all know, everyone is betting big on AI.” 

He argued that bubble fears can be spread by people who do not really understand the future power of the technology, and while adoption has been slow, end users are still massively investing.

Ben said: “Imagine if they solve automated customer support, which isn’t too far-fetched. That is a global industry that can be transformed overnight with billions saved in wasted costs, and happier customers who can get instant decent support, e.g. upgrading a mobile phone contract, which is just a nightmare.

“The stock market has been falling sharply on this fear, and although we might be in a mini bubble that does fall even more over the next couple of years, it’s based on real technology that is driving way more value than the cloud digital transformation initiatives.”

Chief technical strategist for LPL Financial, Adam Turnquist, told the BBC that the question was not whether the company would beat expectations, “but by how much”.

Senior equity analyst at Hargreaves Lansdown, Matt Britzman, said that valuations for certain areas of the AI sector “needed to take a breather, but Nvidia is not in that camp”. He added: “While AI valuations are dominating the news feeds, Nvidia is going about its business in style.”

Huang has previously stated that he expected $500B in AI chip orders through next year, but NVIDIA’s chief financial officer, Colette Kress, told analysts that the company would “probably” be taking more orders on top of the $500B.

Tech sector giants have been ramping up spending on AI amid a boom that has pushed stocks to record highs.

Final Thoughts 

Last month, NVIDIA became the first ever company to be valued at $5T. The stronger-than-expected revenues have eased investor concerns about significant AI spending, but fears are not yet eliminated – and it’s doubtful they ever will be. 

Demand outlook remains extremely strong, and AI is arguably moving from pure hype to real economic impact. But the ‘b-word’ will follow major AI players around for a while, and it will take more than a strong – albeit very strong – quarterly performance to kill off fears of a bubble entirely.