Nvidia (NVDA) Stock Gains as Big Tech Spending Spree Fuels Chip Demand

TLDR

• Microsoft spent $37.5 billion on AI infrastructure in Q2, with most going to chips
• Meta projects $135 billion in 2026 capex, doubling last year’s investment
• Both companies say AI demand outpaces their computing supply
• China greenlit Nvidia H200 chip sales to ByteDance, Alibaba, and Tencent
• Nvidia stock hit highest close since early November

Nvidia shares reached their highest closing price since early November on Wednesday. The stock dipped 0.7% after hours but continues trading near recent highs.

NVIDIA Corporation, NVDA

The rally comes as major technology companies announce bigger-than-expected AI spending plans. Microsoft and Meta both revealed investments that caught Wall Street off guard.

Microsoft’s fiscal second quarter capital expenditures totaled $37.5 billion. That beat the Street’s $36.7 billion estimate. Roughly two-thirds went toward purchasing chips.

CFO Amy Hood explained that AI hardware shortages continue limiting cloud business growth. The company uses its in-house Maia 200 chip alongside processors from Nvidia and AMD.

Meta Goes All-In on AI Capacity

Meta Platforms announced even larger plans for 2026. The social media giant expects to spend up to $135 billion this year. That’s 20% above analyst expectations and twice what it spent in 2025.

CFO Susan Li described a significant capacity gap. “Demands for compute resources across the company have increased even faster than our supply,” she told analysts.

The company plans to add capacity throughout the year. But Li warned constraints will persist through most of 2026. Meta’s own data center facilities won’t contribute meaningfully until late in the year.

China Opens Door for H200 Sales

Nvidia scored a win in China on Wednesday. Reuters reported Chinese authorities approved H200 chip sales to major domestic tech firms.

ByteDance, Alibaba, and Tencent can now purchase the advanced system. This reverses earlier pressure for companies to buy Chinese-made alternatives.

The U.S. had authorized these sales earlier in 2026. But Chinese regulatory approval remained uncertain until this week. Nvidia previously estimated China export restrictions cost $8 billion in lost revenue.

Broader Chip Sector Momentum

Other semiconductor companies posted strong results Wednesday. ASML reported fourth-quarter earnings and orders that topped expectations. The Dutch firm’s 2026 sales guidance also exceeded forecasts.

SK Hynix shares jumped over 5% after announcing record 2025 profits. The VanEck Semiconductor ETF climbed 1.9%.

Nvidia shares gained approximately 1.6% in premarket trading. The moves reflect growing confidence that AI chip demand will remain robust as tech giants race to expand computing power.

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