Over the past three years, Nvidia (NASDAQ: NVDA) has produced incredible returns while riding the wave of a rapidly growing artificial intelligence (AI) market. However, the bears argue that at some point, demand for the company’s AI chips will cool, and the tech giant will be one of the corporations to experience a significant correction as the AI bubble bursts.
That may not be anytime soon, though. Nvidia’s CEO Jensen Huang continues to be bullish on the future of AI, and he recently said something that implies that demand for the company’s chips isn’t about to slow down; quite the opposite. Here’s what investors need to know.
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Nvidia’s data center segment accounts for most of its revenue and has been the main driver of sales growth over the past few years. In the fourth quarter of its fiscal year 2026, ending on Jan. 25, total revenue came in at $68.1 billion, up 73% year over year. Data center revenue was $62.3 billion (or 91% of the total top line), up 75% year over year, driven by expanding demand for AI chips. Here’s the problem, if there is one: Nvidia itself says that its revenue is significantly concentrated among a few customers.
During its fiscal year 2026, one of its direct customers accounted for 22% of total revenue, while another accounted for 14%. It did not say which, but we can try to guess: It is likely one of the leading cloud computing players, such as Amazon or Microsoft. Whomever it is, though, what happens if they significantly slow down these investments in AI chips? Nvidia’s revenue will decline meaningfully. Not to worry. Huang does not believe that will happen. Here’s what he said during Nvidia’s fourth quarter earnings conference call:
We have now seen the inflection of agentic AI and the usefulness of agents across the world and enterprises everywhere.
Agentic AI refers to AI tools that don’t just respond to prompts like AI chatbots do. Instead, they independently figure out and execute steps to accomplish a goal. Huang thinks agentic AI will find applications in every sector and industry, and he also believes it could be a multi-trillion-dollar opportunity. AI agents are more complex and sophisticated than chatbots, which means they require more computing power to train.
In other words, the inflection point of agentic AI, which we have now reached, according to Huang, will drive greater demand for the company’s products. So, businesses will keep spending small fortunes on Nvidia’s AI chips, allowing the tech giant to continue generating strong revenue and earnings, just as it has in recent years. If Huang is right, it’s great news for investors, except for the bears, as it means there is still time to get in on the act and purchase the company’s shares.
