Analyst Dan Ives says Nvidia's chip demand is outpacing supply 12 to 1. The comments land as Alphabet, Amazon and Microsoft all raise AI spending plans, while Nvidia's own revenue and earnings are growing faster than its stock price.
Nvidia's demand-to-supply ratio for its AI chips stands at 12 to 1, according to tech analyst Dan Ives. According to CNBC: "Demand to supply today is 12 to 1 for their chips". Ives, a long-established Nvidia bull, called the AI buildout only in its third inning.
The stock, though, is up just 4% year to date, a gap between Nvidia's share price and Ives's demand comments.
Big tech keeps raising AI budgets
Nvidia's largest customers keep lifting their spending plans. Alphabet raised its full-year capital expenditure guidance to $195 billion-$205 billion, up from $180 billion-$190 billion earlier in the year. Amazon also raised its projected capital expenditures to $220 billion, with higher memory costs playing a big role.
Microsoft, meanwhile, set its own ambitious spending targets but told investors it expects positive free cash flow in fiscal 2027, easing concerns it would need debt or dilution to fund its AI buildout.
Revenue is outrunning the stock price
Nvidia's fundamentals are moving faster than its share price. Revenue surged 85% year over year in fiscal 2027's first quarter, which ended April 26, 2026, and net income more than tripled over the same period, leaving the stock on a forward P/E of 22 — in line with the S&P 500 despite Nvidia growing faster than nearly every company on the index. Separately, Nvidia posted $82 billion in first-quarter revenue and guided for $91 billion in the second quarter, according to Crypto Briefing.
If Ives's 12-to-1 estimate holds, tech companies still need to buy far more chips than Nvidia can currently ship. Physical AI uses such as humanoid robots and self-driving vehicles could stretch that shortage even further, giving Nvidia more room to grow before supply catches up.
Sources: The Motley Fool, Crypto Briefing
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