Nvidia just blew its results out of the water thanks to a technology spending wave that analysts haven't seen 'since the internet in 1995'

• Nvidia announced record revenue of $13.51 billion for the second quarter of the 2024 fiscal year.
• The chip company counts almost every major tech company as a client, including Meta, Google, and Oracle.

Nvidia, the leading company behind GPU chips used for artificial intelligence software, announced groundbreaking revenue for its second quarter — and an even stronger forecast than expected for the third.

In an earnings call Wednesday, the company, known for designing graphics hardware, said its quarterly revenue was $13.51 billion — up 88% from the previous quarter and up 101% from one year ago. The enormous revenue reflects an increase in AI spending from Nvidia's largest clients, such as Google Cloud, Meta, and Oracle.

In the next quarter of this year, Nvidia expects to have cut revenue of about $16 billion, well over Bernstein analysts' estimate of $11.35 billion.

These results, while impressive on their own, have larger implications for the "AI Gold Rush," according to analysts from Wedbush Securities.

Wedbush referred to the AI industry as a "1995 Moment and not 1999/2000," referencing the year that interest in the Internet exploded — and the years that the dot-com bubble of the late 20th century burst.

Nvidia's earnings are a sign that AI spending should keep rising and avoid a dot-com-style crash, the brokerage firm argued.

According to estimates from the International Data Corporation, spending on AI will grow by 27% on average every year between 2022 and 2026.

"This build out is unlike anything we have seen since the Internet in 1995 and the ramifications are just starting to ripple through the consumer/enterprise landscape," Wedbush analysts said in a statement.

Growth in the IT sector grew an average of 24% per year from 1995 to 2000, but dropped sharply in 2001 and 2002, according to a report from Mark Doms, a senior economist at the Federal Reserve Bank in San Francisco.

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