World stocks steady as Nvidia outlook boosts tech shares

Nvidia just posted a quarter that made even the most optimistic Wall Street estimates look modest. The chipmaker reported $96.2 billion in second-quarter revenue for fiscal 2027, a 106% jump from the same period a year ago and roughly $4 billion above what analysts had penciled in.

The real kicker wasn’t the quarter itself. It was the forward guidance. Nvidia projected roughly 70% revenue growth for fiscal 2028, nearly doubling the 45% consensus estimate among analysts.

The numbers behind the rally

Nvidia’s data center business generated $89 billion in revenue during the quarter, a 117% year-over-year increase, driven by what CEO Jensen Huang described as supply-constrained AI demand at a “critical inflection point.”

Adjusted earnings per share came in at $2.22, with gross margins holding at a healthy 75%. For the third quarter, Nvidia guided revenue of approximately $108 billion, plus or minus 2%.

Shares responded accordingly, climbing between 6% and 7.4% in premarket trading on August 27. At least 10 brokerages raised their price targets in the aftermath. Goldman Sachs bumped its 12-month target to $300, while Citigroup went a step further to $315.

Why AI demand keeps defying gravity

Hyperscalers, the massive cloud providers like Microsoft, Amazon, and Google, continue to pour capital into AI infrastructure. Nvidia sits at the center of that spending because its GPUs remain the hardware of choice for training and running large language models.

CFO Colette Kress reinforced this during the earnings call, noting that demand continues to outstrip supply. Notably, demand for Nvidia’s products is beginning to extend beyond the largest cloud providers to encompass AI laboratories, neo-cloud operators, and enterprise customers, pointing to a diversifying base for future growth.

The 70% fiscal 2028 growth forecast is particularly notable. Consensus had settled around 45%, which itself was already an aggressive number for a company of Nvidia’s size.

What this means for global markets

For investors weighing their exposure to AI-related equities, Nvidia’s results serve as a data point that the trade isn’t over. The company’s revenue trajectory suggests that capital flowing into AI infrastructure is accelerating, not decelerating. That has downstream implications for semiconductor equipment makers, memory chip producers, and the power infrastructure companies building out data center capacity.

The risk, as always, is concentration. Nvidia’s outsized influence on major indices means that any stumble, whether from geopolitical disruption, export restrictions, or a genuine demand slowdown, would ripple far beyond its own stock price.

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