Nvidia forecasts quarterly revenue above estimates

(Patria) - Nvidia on Wednesday forecast second-quarter revenue above Wall Street expectations and announced an $80 billion share buyback program, Reuters reported.

The world's most valuable company expects revenue of $91 billion, plus or minus two percent, compared to estimates of $86.84 billion, according to data compiled by LSEG.

Nvidia's results are largely seen as a barometer of the health of the artificial intelligence (AI) market, as the company's chips are used in almost every major data center in the world, powering the largest and most advanced models.

The company also announced it would increase its quarterly cash dividend from one cent per share to 25 cents per share.

Spending on AI infrastructure continues to grow rapidly, with US tech giants including Alphabet, Amazon, and Microsoft expected to spend more than $700 billion on AI this year, a sharp increase from around $400 billion in 2025.

While heavily reliant on Nvidia's expensive processors, companies are also investing in developing their own custom chips to power models, posing a risk to Nvidia's long-standing dominance in the chip industry.

These chips are aimed at inference, the process by which AI responds to user queries, which represents a much larger market than training.

Nvidia faces competition not only from big tech companies but also from other chip rivals, including Intel and Advanced Micro Devices, which have announced a big revenue opportunity from the inference market.

The Santa Clara, California-based company has taken steps to defend its position. In March, it introduced a new central processing unit and AI system built on the technology of Groq, a startup specializing in inference.