Nvidia (NASDAQ: NVDA) shares jumped 7% Thursday after its new sales forecast eased worries that the AI spending boom may be losing steam. The move followed Nvidia’s fiscal second-quarter 2027 report, where management gave a revenue outlook showing demand remained strong.
The rally was also tied to Nvidia’s fight for AI developers using Chinese models. On Wednesday, the company said it was improving support for DeepSeek V4 Flash, Alibaba Group (NYSE: BABA) Qwen 3.8, models from Alphabet (NASDAQ: GOOGL) subsidiary Google, and Nvidia’s own software.
Nvidia tunes its platform for Chinese AI as U.S. officials consider new limits
Chinese AI models have advanced quickly in 2026, and more developers worldwide are using them. Nvidia is adjusting its chips and software rather than leaving the opening to Chinese hardware makers. Huawei, which makes Ascend processors, and Alibaba have already rolled out support for DeepSeek, Qwen, and other open models.
Nvidia called its program a “local AI initiative with optimizations for top open models.” Its broader aim is to keep developers using American computing systems even when the AI model they pick was created in China.
An Nvidia employee allegedly told CNBC, “Providing support for models worldwide allows developers to build on the American tech stack.”
The employee added, “Developers using popular American and Chinese models will choose the stack that the model is optimized for, making the need to optimize for the American stack critical.”
Nvidia is also opposing initial federal regulations for open-weight artificial intelligence. Microsoft (NASDAQ: MSFT), Meta Platforms (NASDAQ: META), Palantir Technologies (NASDAQ: PLTR), Nvidia, and over 20 other firms have all signed a July letter warning authorities to not impose “premature restrictions” on AI models firms can download, modify, and operate.
However, Nvidia has recognized that politics may pose some problems. In its most recent filing with the SEC, Nvidia warned that White House regulations targeting AI created in China may hurt certain aspects of its business.
The employee also said, “Developers will be very important in building the winning AI ecosystem. China has one of the largest populations of developers in the world, creating open-source foundation models. Every model should run best on the U.S. technology stack, encouraging nations worldwide to choose America.”
Nvidia’s unpaid bills climb fast as a Hugging Face deal could widen its software reach
The quarterly report also included figures traders are watching. Nvidia’s net accounts receivable climbed about 63% between January and July, moving from $38.5 billion to $63.1 billion. That means the company has booked far more sales where customers still have not paid the money owed.
D.A. Davidson tech research head Gil Luria told CNBC, “It’s worth keeping an eye on.” Gil added, “We have to pay close attention, because the numbers are so big and they’re making really big commitments way out into the future.”
Wall Street banks think the total could rise much further. Bank of America (NYSE: BAC) expects Nvidia’s receivables to reach about $71 billion in January 2027, then $113 billion in 2028 and $147 billion in 2029. From 2027 through 2029, that would be an increase of around 107%.
Morgan Stanley (NYSE: MS) has a higher forecast. It expects the figure to go from about $78.6 billion in January 2027 to $171 billion in January 2029, which works out to roughly 117% growth.
Nvidia’s receivables are also concentrated among a small group of buyers. The company said five direct customers made up 70% of total receivables, with large cloud providers accounting for most. One year earlier, three direct customers made up 56% during the same period.
Meanwhile yesterday, Nvidia agreed to pay $12.9 billion for the open-source AI platform Hugging Face, citing someone with direct knowledge of the deal. Business Insider separately said Nvidia had been “in talks” to buy Hugging Face.
Developers use Hugging Face to share, test, and build with open-source AI models. If the deal goes through, Nvidia would own a major platform sitting at the center of that activity. It would also move Nvidia further past its core GPU business and deeper into the software market where developers decide which models, tools, and computing systems they want to use.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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