Nvidia became a couple of days ago the first company in history to reach five billion dollars stock market valuation. The figure is impressive, but even more so is this fact: in July it was “only” worth four billion. It has taken three months to attract a billion dollar investment. It took Apple two years.
AI is growing too fast, and the signs of a bubble are increasingly evident. For almost everyone except their investors, and for Nvidia CEO and founder Jensen Huang: «I don’t think we’re in an AI bubble. All these different AI models that we’re using… we’re using a lot of services and happily paying for it.»
It is true that there are many services, and you pay for them, but not enough. Companies have to invest a lot of money in producing artificial intelligence, or in using it, but that expense, for now, does not translate into higher income.
Nvidia CEO denies AI bubble
MIT did a study a few months ago, and 95% of companies that have adopted AI have not increased profits.
One of the reasons is that the vast majority of the tasks that this first generation of AI can do They are focused on increasing productivity, but not profits.
Today’s AI can give you ideas, it can summarize texts, create reports, translate, advise, program… It helps you work better, be more productive, but that has no impact on whether the final product that people buy is better. Or that people want to buy it.
Jensen Huang offered a keynote last Wednesday in Washington, with a single objective: convince Donald Trump to let him sell his chips in China.
He first began by detailing his great achievements. Nvidia already has chip orders until the end of 2026, worth $500 billion. And it will build seven supercomputers for the government. It plans to sell 20 million of its new Blackwell and Rubin AI chips, up from 4 million sold by the previous generation Hopper.
It has invested 100 billion in OpenAI, 5 billion in Intel, 1 billion in Nokia…
Submission to Donald Trump
Throughout the conference, Nvidia founder praised Trump countless timesand even closed the talk with “let’s make America great again.” The technology companies eat from Trump’s hand, they kiss his feet, because he has the key to exports, with his tariffs and his vetoes.
Jensen Huang repeated what he said days ago: «In China we have gone from dominating 95% of the AI market to 0%. And half of the AI companies are there.»
Nvidia is frustrated by losing the world’s second largest market, which it had dominated. And while, The bubble grows, although the company’s CEO denies it.
Nvidia is almost the only artificial intelligence company that makes money. The rest live off investors, but their patience has a limit.
All investments in AI feed off each other among the same companies in the sector: Nvidia invests in OpenAI, in Intel, in xAI, but with conditions that imply that these companies spend a lot of money in data centers, for which they need many AI subscriptions that, for now, do not arrive.
«The current expansion of AI depends on a few dominant players mutually financing their capacity. The moment investors start demanding cash flow returns instead of capacity announcements, some of these drivers could grind to a halt,» he assures Reuters Matthew Tuttle, CEO of Tuttle Capital Management.
The reality is that we have had AI for four years, and it is still in the redwhile investments do not stop growing. That’s a sign of a textbook bubble, although Jensen Huang denies it. The life of your company depends on it.