Nvidia has quashed speculation of an AI slowdown with a robust first-quarter revenue forecast of $43 billion, surpassing Wall Street’s $41.78 billion estimate, according to LSEG data.

The Santa Clara-based chip giant’s outlook, driven by soaring demand for its new Blackwell AI semiconductors, reaffirms its dominance in the artificial intelligence (AI) hardware race.

CEO Jensen Huang’s upbeat declaration—“AI is advancing at light speed, and demand for Blackwell is amazing”—sent a clear message: the AI boom is far from over.

The forecast comes as a relief to investors after last month’s market jitters, sparked by Chinese AI startup DeepSeek’s claim of building cost-efficient models to rival Western tech at a fraction of the price.

That news triggered a $593 billion single-day drop in Nvidia’s market value—the largest ever for a U.S. company—fueling fears of softening demand for Nvidia’s pricey AI chips.

READ MORE: The DeepSeek Ripple Effect: Impact on Tech Stocks and Global Markets

Yet, the company’s latest results, including $11 billion in fourth-quarter Blackwell-related revenue (nearly 50% of its data center haul), silenced skeptics. Shares ticked up 3.7% in regular trading before seesawing in volatile after-hours action.

Nvidia’s transition to the Blackwell architecture, moving from standalone chips to integrated AI supercomputing systems, has hit full stride.

“We’ve ramped up massive-scale production of Blackwell AI supercomputers, achieving billions in sales in its first quarter,” Huang said, highlighting a shift that bundles graphics chips, processors, and networking gear.

The data center segment, Nvidia’s revenue powerhouse, grew 93% to $35.6 billion in the quarter ending January 26, topping estimates of $33.59 billion and cementing its lead in AI infrastructure.

Analysts see the results as a turning point. “Skepticism was high heading into this report, with DeepSeek’s efficiency claims and Blackwell rollout concerns looming large,” said eMarketer’s Jacob Bourne.

“Nvidia’s performance has swept those doubts away.”

Still, the Blackwell ramp-up hasn’t been without hurdles. First-quarter gross margins are projected to dip to 71%, below Wall Street’s 72.2% expectation, reflecting the high costs of scaling production.

CFO Colette Kress, however, reassured investors on a call that margins should rebound to the mid-70s later this fiscal year as efficiencies kick in.

The broader AI rally, which has propelled Nvidia’s stock up over 400% in two years, stumbled last month amid DeepSeek’s rise and reports of Microsoft scaling back U.S. data center leases, hinting at potential oversupply.

Microsoft, committing $80 billion to AI this year, and Meta, pledging up to $65 billion, represent the hyperscale demand Nvidia thrives on.

Yet, Reuters reported Monday that Chinese firms are snapping up Nvidia’s H20 AI chips to power DeepSeek’s models, suggesting global appetite remains strong.

“Nvidia’s momentum with hyperscalers continues unabated,” noted Third Bridge analyst Lucas Keh.

Adding to the positives, Kress revealed that the Stargate data center project, unveiled last month by President Donald Trump, will leverage Nvidia’s Spectrum X ethernet networking tech—a boost for its data center portfolio.

Fourth-quarter revenue hit $39.3 billion, up 78% year-over-year and beating estimates of $38.04 billion, while adjusted per-share profit reached 89 cents, topping the 84-cent forecast.

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