Nvidia (NVDA) Soars as Memo Justifies Its Staggering $4.5T Valuation—Can the AI Hype Last?

Nvidia's stock surges as an internal memo defends its eye-popping $4.5 trillion valuation—fueled by AI mania and investor FOMO.

The AI Gold Rush

Nvidia's GPUs remain the picks and shovels of the generative AI boom, but skeptics whisper 'bubble' as valuations outpace even crypto's wildest days.

Wall Street's Dilemma

Analysts scramble to justify price targets while quietly hedging—because when the music stops, someone's left holding the bag. (Hint: It's rarely the institutions.)

The Punchline

Another day, another trillion. Just don't ask about fundamentals.

TLDRs;

• Nvidia stock rose 1.37% after issuing a memo defending its $4.5 trillion valuation.

• The memo rejected claims linking Nvidia to accounting scandals, citing solid public disclosures.

• Nvidia posted Q3 fiscal 2026 revenue of $57B, with data center growth at 154%.

• Cross-hardware AI tools boost Nvidia’s ecosystem, opening opportunities for enterprise and cloud vendors.

Nvidia (NVDA) shares edged higher by 1.37% Thursday following the release of a detailed memo to stock analysts defending the company’s $4.5 trillion valuation.

The Wednesday document directly addressed recent criticism from prominent investor Michael Burry and countered a Substack essay that claimed Nvidia was facing inventory buildups and customer payment issues.

NVIDIA Corporation, NVDA

 Memo Counters Criticism and Comparisons

In its memo, Nvidia emphasized that its financial disclosures do not support comparisons to historical accounting scandals such as WorldCom, Lucent, or Enron.

While the company acknowledged certain challenges, including lower gross margins and higher warranty costs for its latest Blackwell chips, it underscored that these issues fall within normal operational expectations.

The memo also responded to market chatter on social media, where some questioned Nvidia’s defense of its business in light of Meta’s reported discussions with Google to use Google’s AI chips. Nvidia congratulated Google on its achievements while affirming that its own chips remain a generation ahead in performance.

Record Revenue and Strong Growth Highlighted

Nvidia’s memo coincided with the release of strong financial figures, including a record Q3 fiscal 2026 revenue of $57.0 billion, up 62% year over year. Data center revenue reached $26.3 billion, reflecting a remarkable 154% growth from the prior year.

Operating cash FLOW hit $14.5 billion in the second quarter, while $37.0 billion was returned to shareholders via buybacks and dividends in the first nine months of fiscal 2026.

$NVDA NVIDIA Q3 FY26 (October quarter).

• Revenue +62% Y/Y to $57B ($1.9B beat).
• Operating margin 63% (+1pp Y/Y).
• Non-GAAP EPS $1.30 ($0.04 beat).

Q4 FY26 guidance:
• Revenue $65B ($3.2B beat). pic.twitter.com/Ft2XtFZqMN

— App Economy Insights (@EconomyApp) November 19, 2025

CEO Jensen Huang noted that Blackwell chip sales were “off the charts,” particularly in the cloud GPU segment, where supply is currently sold out. Despite the lower gross margins for Blackwell, the overall non-GAAP gross margin remained at a healthy 73.6%, maintaining Nvidia’s mid-70% range guidance.

Cross-Hardware AI Boosts Ecosystem Potential

The memo also touched on Nvidia’s role in the expanding AI ecosystem. With companies like Meta exploring heterogeneous AI accelerators, Nvidia’s hardware remains integral for cross-platform AI infrastructure. Open-source tools such as OpenXLA and the ONNX Runtime allow developers to optimize AI models across multiple hardware platforms, achieving significant performance gains on Nvidia GPUs.

This cross-hardware compatibility creates opportunities for infrastructure vendors and cloud integrators to build enterprise AI solutions while reducing dependency on a single vendor. As AI adoption grows, Nvidia’s advanced chips and collaborative ecosystem position the company to remain a leading supplier in both data centers and cloud computing.

Nvidia’s response and strong financials appear to have reassured investors, driving a modest stock increase Thursday. While the AI chip market grows increasingly competitive, Nvidia’s leading-edge products and proactive communication with analysts suggest it is strategically navigating the evolving landscape.