Jensen Huang’s Huge AI Prediction Has Just One Tiny Problem

Jensen Huang has a mode with expansive pronouncements. On NVIDIA's astir caller net call, the CEO told investors that "the buildout of AI factories, the largest infrastructure enlargement successful quality history, is accelerating astatine bonzer speed." The numbers down that connection are real: NVIDIA (NASDAQ:NVDA) conscionable posted $81.61 cardinal successful quarterly revenue, with Data Center unsocial contributing $75.25 billion, up 92% twelvemonth implicit year.

The tiny problem? The customers paying for those factories are opening to inquire harder questions astir what they're getting back.

The Supply Side Looks Bulletproof

Huang's supply-chain framing remains confident. Speaking alongside the SK Group president this past weekend, helium flagged a prolonged spot shortage and elaborate deeper practice with Korean representation suppliers, per Reuters. NVIDIA's ain equilibrium expanse backs the bullishness: full supply-related commitments person climbed to $119.0 billion, up from $95.2 cardinal conscionable 1 4th earlier.

Demand-side commitments are arsenic ambitious. OpenAI has committed to astatine slightest 10 gigawatts of NVIDIA systems, Meta signed a multiyear woody covering millions of Blackwell and Rubin GPUs, and CoreWeave is targeting 5-plus gigawatts of AI factories by 2030.

The Tiny Problem: ROI Math Is Getting Awkward

Three caller disclosures suggest endeavor buyers are struggling to construe token walk into measurable returns.

First, Uber COO Andrew Macdonald told a May 25 league that the institution cannot gully a wide enactment betwixt surging AI token walk and measurable user merchandise improvements. Second, Microsoft canceled interior Claude Code licenses successful its Experiences and Devices part effectual June 30, citing fund overruns from token-based billing. Third, Meta unopen down its interior AI token leaderboard, Claudeonomics, successful April aft employees were recovered gaming it.

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The subject down AI request is tightening, adjacent arsenic wide walk continues to grow. Reddit sentiment connected NVDA has turned mixed-to-bearish, with a wide circulated station highlighting that H200 GPU rental prices fell 38% done the 2nd fractional of May, an aboriginal awesome that compute capableness whitethorn beryllium outrunning monetizable workloads.