NVIDIA's Strong Earnings Report Dispels AI Bubble Fears Amid Circular Financing Concerns
- Nov 20, 2025
- 3 min read
Read the entire Forbes article here:
NVIDIA delivered a blockbuster third-quarter earnings report yesterday, surpassing Wall Street expectations with record revenue of $57 billion and providing an upbeat forecast that contrasts concerns about an AI bubble, according to CNBC. CEO Jensen Huang highlighted robust demand for the company’s AI chips, stating NVIDIA has visibility into a half-trillion-dollar sales pipeline for 2025 and 2026, excluding recent major deals like expansions with Anthropic and Saudi Arabia.
The company now projects total revenue of roughly $203 billion for 2025, with the current quarter (ending late January 2026) expected to hit $65 billion, representing 65% year-over-year growth. Huang dismissed bubble talk, noting, "From our vantage point, we see something very different," and pointing to emerging AI use cases like agentic AI that will drive further computing needs.
The earnings beat sent NVIDIA shares higher in after-hours trading, building on the company’s historic run that saw it become the first firm to close above $5 trillion in market capitalization on October 29, 2025, as reported by Yahoo Finance. For investors who have ridden NVIDIA's explosive growth over the past three years, seeing shares skyrocket from under $20 (split-adjusted) to $186.52 as of yesterday's close, the pressing question is when to pivot.
Mastering the art of trimming or exiting winning positions is crucial, especially as allocations balloon from such appreciation. It’s the enviable problem every investor chases, yet one often mishandled due to fears of missing further upside or hefty tax bills. History is littered with regrets from those who held too long during market peaks. Beneath NVIDIA's glittering headlines, however, lurk details that warrant scrutiny for holders contemplating their strategy.
The Circular Financing Dynamic
Huang’s optimistic outlook includes expectations of robust chip sales, with the company forecasting around $500 billion in revenue potential from AI chips in 2025–2026, as reiterated in a Morningstar report. Yet, a closer look reveals that NVIDIA may be fueling a significant portion of this demand through its own investments in customer companies, creating what appears to be a self-reinforcing financial loop.
Consider NVIDIA’s massive commitment to OpenAI: In September 2025, the company announced an investment of up to $100 billion, phased in as data center capacity expands, with much of the funds earmarked for purchasing NVIDIA's own GPUs, according to NVIDIA Newsroom and Reuters. This deal not only bolsters OpenAI's AI infrastructure but also guarantees a direct return flow to NVIDIA's bottom line. NVIDIA recently clarified that this is not yet a finalized contract, though the announcement stands, as reported by The Times of India.
Similarly, NVIDIA invested $1 billion in Nokia in October 2025, acquiring a 2.9% stake to collaborate on AI-driven telecommunications and 6G technology, NVIDIA announced in a press release. Nokia, pivoting toward AI infrastructure, is likely to deploy these funds in ways that include acquiring NVIDIA hardware for its push into data centers and edge computing.
Broadening the scope, NVIDIA has participated in over 50 venture capital deals as of mid-October 2025, exceeding its 48 deals in all of 2024, and has invested $23.7 billion in AI companies so far this year, according to TechCrunch. While exact figures for each aren’t always public, the pattern is clear: Many recipients, such as those in AI model training, allocate proceeds toward NVIDIA chips.
Proponents argue this strategy showcases NVIDIA’s confidence in AI's future, securing its hardware dominance by nurturing the ecosystem. But critics see a circular flywheel: NVIDIA invests equity—often boosting both parties' stock prices—enabling recipients to buy its chips with minimal net cost to NVIDIA. Such engineering echoes the frothiest phases of past bubbles, where self-sustaining loops mask underlying risks until they unravel.
Rising Insider Sales: A Signal to Heed?
Adding to the cautionary notes, NVIDIA insiders have ramped up stock sales in 2025. While some activity is routine amid the stock’s rally, the pace is noteworthy. According to data from Insider Screener, over the last 90 days, NVIDIA has seen 258 insider trades, amounting to a net value of roughly -$221.8 million, mostly due to sales. In that same timeframe, the stock rose by 6.6%
Insiders may have diverse reasons for selling—diversification, estate planning, or exercising options—but the uptick aligns with periods when executives sense peak valuations. Investors might wisely mirror this by realizing gains and reducing exposure, rather than betting on perpetual growth.
NVIDIA's ascent is undeniable, powered by AI's transformative potential. Yet, the interplay of circular financing and insider selling suggests the rally's foundations may be shakier than they appear. As allocations grow outsized, prudent investors should reassess: Is this the moment to trim, lock in profits, and diversify? History favors those who act before the music stops.
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