Nvidia expects to make US$1 trillion from AI chips through 2027

Despite their success, Nvidia is facing mounting competition from rivals, as well as its own customers attempting to produce in-house chips to handle AI. Photo by Benjamin Fanjoy/Getty Images

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The company had previously forecast that the chips would bring US$500 billion in sales by the end of 2026. The latest forecast, delivered by chief executive Jensen Huang during the company’s GTC event, extends the outlook another year.

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The forecast underscores the scale of Nvidia’s business, which has been supercharged by demand for chips that develop and run AI models. But the cumulative figure doesn’t suggest a tremendous acceleration in sales growth.

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After initially rising as much as 4.8 per cent, the shares soon pared their gains on Monday.

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Nvidia also unveiled new products at GTC, an annual gathering in San Jose, California. It’s adding a chip made with technology it acquired from startup Groq, a move that it says will boost the responsiveness of artificial intelligence systems.

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The company also showed off a computer made up of general-purpose CPUs, or central processing units, marking a fresh expansion into technology pioneered by Intel Corp. The CPU opportunity is “for sure” a multibillion-dollar business, Huang said.

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The GTC rollout is Nvidia’s latest bid to promote artificial intelligence computing and keep customers loyal to its technology. The company uses the event to announce partnerships with companies in a range of industries, aiming to show the increasing benefits of AI.

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A flood of spending on AI chips has turned Nvidia into the world’s most valuable company. But investors have sought more evidence that the market’s growth remains on track. Nvidia is also facing mounting competition from rivals like Advanced Micro Devices Inc., as well as its own customers attempting to produce in-house chips to handle AI.

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The company has accelerated its technology development in recent years. Nvidia tries to replace its entire product lineup on an annual basis while adding new components. The next design of its flagship AI processors, appearing in systems in the second half of 2026, is called Vera Rubin. The lineup is named for the pioneering astronomer whose observations provided evidence supporting the existence of dark matter.

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While Nvidia continues to post sales growth that’s the envy of the chip industry, its stock rally has stalled in recent months. The shares were down 3.4 per cent this year heading into the GTC presentation, leaving the company’s market value at a still-unrivalled US$4.4 trillion.

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—With assistance from Maggie Eastland and Dina Bass.

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