Nvidia Issues Rare Three-Year Forecast Projecting 70% Revenue Growth as AI Demand Reshapes Chip Economics

Nvidia on Wednesday issued a revenue growth outlook for fiscal 2028 projecting a 70% increase over the prior year, an unusually long-range forecast that signals the company expects the current AI infrastructure build-out to sustain rather than cycle. The projection, disclosed alongside second-quarter results that doubled revenue year-over-year, exceeded analyst expectations of 44% growth and arrived as Nvidia restructured its reporting to distinguish between hyperscale cloud providers and a broadening base of enterprise AI adopters.

Revenue for the quarter ended July 26 reached $96.2 billion, up 106% from a year earlier and 18% sequentially, surpassing the $92.2 billion consensus estimate. Data center sales, which now constitute the vast majority of Nvidia’s business, came in at $89 billion against expectations of $85.7 billion. The company guided for $91 billion in the current quarter, plus or minus 2%.

In a departure from standard semiconductor reporting practice, Nvidia split data center revenue into two categories: $48.7 billion from hyperscale customers — the large cloud platforms building massive GPU clusters — and $40.3 billion from what it terms AI clouds, industrial, and enterprise (ACIE), encompassing sovereign AI initiatives, AI-native cloud providers, and on-premises enterprise deployments. The breakdown reveals that non-hyperscale demand now accounts for nearly half of data center revenue, a shift with implications for the durability of Nvidia’s growth.

“AI has reached its inflection point,” founder and CEO Jensen Huang said in a statement. “It’s doing useful work. Its tokens are productive and profitable. Now, compute is revenue. And demand is accelerating.”

The fiscal 2028 outlook — roughly three years forward — is rare in an industry where quarterly visibility is often limited. Most chipmakers decline to provide specific guidance beyond the current quarter. Nvidia’s willingness to quantify a 70% compound annual growth trajectory suggests high confidence in both the pace of AI model development and the willingness of customers to fund the infrastructure required to run them.

Non-GAAP earnings per diluted share reached $2.22, above the $2.06 to $2.09 analyst range. The company began including stock-based compensation in its non-GAAP results this quarter, a change that complicates direct comparison with prior periods but aligns its reporting more closely with peer practices.

Shares reversed an initial post-earnings decline to rise more than 5% in after-hours trading as executives detailed the results on a conference call.