The artificial intelligence revolution isn't coming - it's already here, and chipmaker Nvidia's blockbuster earnings report this week should eliminate any remaining doubts. The US technology giant didn't merely exceed Wall Street's expectations; it demolished them, surpassing fiscal third-quarter predictions by over $2 billion and fourth-quarter projections by an even more substantial margin.
Why This Isn't Another Tech Bubble
According to Dan Ives, global head of tech research at Wedbush Securities with nearly three decades of experience as a technology analyst, this moment bears no resemblance to the 1999 internet bubble that wiped out an estimated $5 trillion in investment. "This is no 1999 moment," Ives states emphatically.
Wedbush research reveals that only 3% of US firms have begun integrating AI into their operations, with merely 1% of companies worldwide boarding the AI train. This indicates enormous untapped potential for growth as more businesses embrace artificial intelligence technology.
Early Adopters Reaping Rewards
Companies that have already implemented AI are demonstrating impressive results. Walmart recently reported strong third-quarter revenue growth of 5.8% year-over-year, defying concerns about a slowing US economy, while simultaneously raising its full-year outlook. The retail giant attributes part of this success to substantial investments in AI to create personalised shopping experiences.
Another standout example is data analytics firm Palantir. Just two years ago, Palantir had virtually no commercial business, yet today it's approaching $1 billion in revenue without even tapping into the consumer market.
Ives projects that by 2030, 20% of vehicles will be autonomous, with companies across diverse sectors discovering new AI applications. The return on AI investment is already becoming demonstrable, and the expansion potential for this enterprise sector remains mind-boggling.
Nvidia's Dominant Position
In the short term, Ives anticipates Nvidia will join the exclusive $6 trillion market capitalisation club within the next 12 to 18 months. Looking further ahead, he positions Nvidia in year three of a potential ten-year bull run. Building the complete foundation for this AI revolution will require decades, and currently, Nvidia chips represent the only serious game in town.
Wedbush estimates reveal a crucial multiplier effect: every dollar spent on a Nvidia chip generates $8 to $10 in additional expenditure on software, infrastructure, and data centres. This explains why Big Tech's capital expenditures could reach an astonishing $550-600 billion in 2026 alone.
"A rising tech tide will lift all ships," Ives observes, though he acknowledges valid concerns about valuation and market concentration among a small group of companies dominating the AI trade.
Drawing an analogy to a party, Ives remarks: "I got the invite at 9pm. It's now 10:30pm and this thing is going strong till four in the morning, but the bears will still be watching through the front window."
Finally, Ives highlights a significant geopolitical dimension: for the first time in thirty years, the United States leads China in the technology race, with American companies including Nvidia, Microsoft, Google, OpenAI, Palantir, and Oracle competing aggressively for global market share.
