Nvidia Blew Past Expectations and the AI Trade Roared Back. The Nasdaq Jumped 411. Now Warsh Takes the Stage.

The bar was set impossibly high, and Nvidia cleared it. The AI bellwether jumped 8.7% — its strongest performance in roughly two years — after beating across the board and guiding to revenue growth far above what Wall Street modeled, reviving a trade that had spent weeks being punished for spending. The Nasdaq surged 1.57% (+411 points) to 26,541.35, the S&P rose 0.72% to 7,730.99, and the Dow added 105.56 points (+0.19%) to 53,569.44. Software joined the party, with Salesforce, CrowdStrike and Okta all posting double-digit gains. Now everything turns to this morning: Warsh’s first Jackson Hole keynote as Fed Chair.

Here’s what mattered:

💾 Nvidia — the AI boom isn’t running out of demand

• Nvidia +8.7% after beating on revenue and EPS and raising Q3 guidance.
• The engine: fiscal Q2 revenue came in around $86.2 billion, up roughly 53% year-over-year — with the data-center business at about $80 billion, growing 117%.
• The guide that stunned: revenue growth now projected at ~70% for fiscal 2028 — well above the ~44–45% analysts expected.
• The caveat that makes it stronger: the outlook effectively excluded China data-center revenue, reflecting continuing restrictions — which makes the 70% projection more notable, not less.
• Separate headline: The Information reported Nvidia had agreed to acquire Hugging Face for $12.9 billion — though neither company has confirmed, and the talks are reported not to have produced a signed agreement.
• Jensen Huang, on the buildout: his only regret is that he “didn’t invest more and sooner” in AI labs.

📈 The read-through — chips and software both ripped

• Semis followed: Broadcom, Intel and SK Hynix all closed higher.
• Software roared: Salesforce +21.5% (revenue $11.35B, adjusted EPS $5.90, more than doubling on an investment gain), Okta +19% (adj EPS $1.05 on $805M revenue), CrowdStrike +18%.
• Breadth of the move: among the strongest sessions for tech, the S&P 500 and the Nasdaq in weeks.

⚖️ The counterweight — the AI buildout’s debt bill

• eToro’s Lale Akoner framed it precisely: Nvidia’s results show the AI boom is not running out of demand — while delivering that growth is becoming more expensive and capital-intensive.
• The scale: companies have borrowed roughly $600 billion to fund the AI buildout since last year, per Bloomberg.
• The tension the whole summer has circled: demand is real and accelerating, but the capital intensity behind it keeps climbing.

📊 Thursday Snapshot (Aug 27)

• Nasdaq: +1.57% → 26,541.35 (+411 pts) · S&P 500: +0.72% → 7,730.99 · Dow: +0.19% → 53,569.44 (+105.56)
• Nvidia +8.7% — Q2 revenue ~$86.2B (+53% YoY), data center ~$80B (+117%), FY28 growth guided ~70% vs ~44% expected
• Software: Salesforce +21.5% · Okta +19% · CrowdStrike +18% · Broadcom, Intel, SK Hynix higher
• Also: Hugging Face deal reported at $12.9B, unconfirmed · China excluded from guidance · VIX ~14.6

📅 Today

All times GMT:

• ⚡ Warsh’s Jackson Hole keynote — his first as Fed Chair, this morning.
• The hand he holds: core PCE in line at 3.3% but headline hotter at 3.7%, a labor market that contracted in July, long yields that shrugged off Treasury intervention, and a committee that split 9-3 in July.

🧠 Bottom line

For six weeks the market punished every AI name that admitted it was still spending — Alphabet, Tesla, SpaceX and AMD all beat and fell. Nvidia broke that pattern, because it’s the one company that collects the spending rather than making it. A data-center business growing 117% and a fiscal-2028 outlook nearly 60% above what analysts modeled is about as emphatic an answer as the AI demand question could get — and it came without counting China.

But Akoner’s framing is the honest counterweight: demand is intact, while delivering it grows more capital-intensive, with roughly $600 billion already borrowed to fund the buildout. Nvidia’s quarter validates the revenue side of the AI trade without resolving the financing side — the question that has driven every selloff since July.

Which makes this morning the real test. Warsh steps up to his first Jackson Hole keynote with core inflation cooperating, headline drifting higher, a labor market that shed jobs in July, and a bond market that ignored a Treasury rescue. Nvidia answered the market’s question. Warsh answers the harder one.

Nvidia proved the AI demand is real. The Nasdaq jumped 411 points. Now Warsh has to explain the rest.