Nvidia Stock Jumps as Microsoft, Meta Commit to Continued Heavy AI Spending

KEY TAKEAWAYS

Nvidia (

NVDA

) shares are surging in premarket trading Thursday as two of its key customers—
Microsoft
(

MSFT

) and
Meta Platforms
(

META

)—posted strong results and committed to continuing their heavy
artificial intelligence (AI)
spending.

During Microsoft’s earnings call Wednesday, CFO Amy Hood reiterated the company’s plan to spend
$80 billion
on AI infrastructure in fiscal 2025. Meta, meanwhile, said it plans to boost its
capital expenditures
this year to $64 billion to $72 billion to grow its AI capacity. Mark Zuckerberg, the social media giant’s CEO, called the opportunities in deploying the technology ”
staggering
” during Meta’s earnings call.

Nvidia shares, which are jumping about 4.5% less than an hour before the opening bell, have been
struggling
this year, falling 19% entering Thursday partly due to investor concerns that Big Tech is slowing or pausing some AI data center buildouts amid the uncertain economic outlook. The company dominates the market for chips needed to build AI systems.

Shares in the chip designer have also taken a hit from the rising economic uncertainty triggered by the trade war as well as growing tensions between Beijing and Washington. It recently warned investors that it expects to take a
$5.5 billion first-quarter charge
after the U.S. government limited exports of its AI chips to China. Nvidia is expected to report quarterly earnings later this month.

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