Nvidia's Tepid Forecast Stokes Fear of AI Spending Slowdown

Its outlook adds to concern that pace of investment in AI systems is unsustainable

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SAN FRANCISCO - Nvidia, the world's most valuable publicly traded company, gave a tepid revenue forecast for the current period, fueling concerns that a massive run-up in artificial intelligence (AI) spending is slowing.

Sales will be roughly US$54 billion (S$69.4 billion) in the fiscal third quarter, which runs till end-October, the company said in a statement on Aug 27. Although this is in line with the average Wall Street estimate, some analysts have projected more than US$60 billion.

The forecast excluded data center revenue from China, a market where Nvidia has struggled with US export restrictions and opposing pressure from Beijing.

The company's tepid outlook adds to concern that the pace of investment in AI systems is unsustainable.

Difficulties in China have also clouded Nvidia's business. Though the Trump administration recently eased restrictions on exports of some AI chips to that country, the reprieve has not yet translated into a rebound in revenue.

Nvidia shares fell about 4 percent in extended trading on Aug 27 following the announcement. They had rallied 35 percent in 2025 as at the close, lifting the company's market capitalization above US$4 trillion.