Analysis: Nvidia beats, Taiwan wins — and hyperscalers race to make AI pay

Nvidia's shares rose nearly 9% after its Q2 revenue doubled to $96B, beating forecasts. The AI chipmaker's strong results lifted tech stocks, with the Nasdaq up 1.6%. Salesforce also surged 22% on strong earnings and AI demand. Investors await Fed Chair Kevin Warsh's speech.

Nvidia's shares rose 8.7% after Q2 results beat forecasts, with revenue of $96.2B and earnings of $2.22 per share. Data center revenue doubled, and the company forecast Q3 revenue of $108B. Nvidia's market cap reached $5.49T, adding $441.5B in one day. The company is reportedly acquiring Hugging Face for $12.9B.

Raymond James analyst Simon Leopold predicts Nvidia could reach $1 trillion in revenue by 2029, with 70% growth guided for 2027. Nvidia's 2027 revenue is expected to be $403 billion, potentially rising to $700 billion in 2028. The article discusses factors that could lead to an AI bust and compares current market conditions to historical tech crashes.

Asian shares mostly rose Friday, following gains in U.S. tech stocks led by Nvidia, which surged 8.7% after strong earnings and forecasts. Salesforce also jumped 22.6% on AI-driven results. U.S. futures were flat, and oil prices dipped. Key Asian indices saw mixed movements, with Tokyo up 0.8% and Hong Kong up 0.3%.

Nvidia reportedly agreed to acquire AI platform Hugging Face for $12.9 billion, according to The Information. The deal, not yet confirmed by either company, would expand Nvidia's influence in the open AI model ecosystem. Hugging Face's annualized revenue is over $150 million, making the purchase price roughly 80 times its revenue.

NVIDIA (NVDA) reported $96.2B revenue, up 106% YoY, with Data Center revenue at $89.0B, up 117% YoY. Excluding China Data Center compute revenue, it guided for $108B in Q3. Gross margins were 75%, but are expected to decline to 74% in Q3. ACIE, a fast-growing Data Center segment, now represents 45% of Data Center revenue.