Jensen Huang has made the rare admission that NVIDIA now faces a dilemma with no apparent solution: strong performance could lead to accusations of fueling an AI bubble, while weak results would be seen as evidence of the bubble bursting.
As the global market becomes embroiled in debates over an "AI bubble," even NVIDIA, one of the most successful companies, is facing unprecedented scrutiny. As a core supplier of AI infrastructure, every move made by NVIDIA is seen as a barometer for the health of the entire industry.
According to a report by Business Insider on Friday, NVIDIA CEO Jensen Huang admitted in an internal meeting on Thursday that despite the company delivering "incredible" results, "the market remains unconvinced." The head of this chip giant unusually acknowledged that NVIDIA now faces an unsolvable dilemma: stellar performance is accused of fueling the AI bubble, while poor performance is viewed as evidence of the bubble bursting.
Huang stated in the meeting that market expectations for NVIDIA have become so high that the company is trapped in a kind of "no-win situation." He frankly remarked, "If we deliver a poor quarterly report, even if it’s just slightly off, and appears a little unstable, the entire world will collapse."
Trapped in a "no-win dilemma"
According to the recording of the meeting obtained by Business Insider, Jensen Huang elaborated on NVIDIA's current predicament during the internal meeting on Thursday. "If we deliver a poor quarterly report, it will be seen as evidence of the AI bubble. If we deliver an outstanding quarterly report, we are accused of inflating the AI bubble," he said.
Huang pointed out that market expectations for NVIDIA have reached such heights that the company finds it difficult to satisfy investors regardless of its performance. He mentioned online discussions about the company's significant economic influence, saying, "You should see some of the jokes on the internet. Have you seen any? Essentially, we are supporting the entire planet – and it’s not an exaggeration."
He also cited posts claiming that NVIDIA's performance is helping the U.S. avoid a recession, underscoring how the market has come to view this chipmaker as a key indicator of macroeconomic health.
NVIDIA's earnings report released on Wednesday showed that revenue in the third quarter grew by 62% year-over-year, with guidance for the current quarter surpassing expectations once again. Jensen Huang rebutted the growing sentiment about an AI bubble during the earnings announcement. However, market reaction has been volatile: after rising on Wednesday (at one point exceeding 6%), the stock fell again on Thursday, closing down more than 3%. The company’s market value has shed approximately USD 500 billion in just a few weeks.
Jensen Huang joked at the conference about the "good old days" when the company’s market value reached $5 trillion. "Historically, no one has lost $500 billion in a few weeks," he said. "You need to be worth a lot of money to lose $500 billion in a few weeks."
This fluctuation in market value reflects growing doubts among investors regarding the sustainability of the AI investment boom, even in the face of strong earnings data.
Editor /rice