Nvidia Faces Scrutiny Over Demand Sustainability Despite $5 Trillion Valuation

Nvidia (NVDA) faces mounting scrutiny over its demand sustainability despite achieving a $5 trillion market cap in October 2025. While CEO Jensen Huang touted partnerships with Uber and Palantir at the GPU Technology Conference, Seaport Global remains the lone firm with a "sell" rating, arguing the company is artificially manufacturing demand through customer financing. The chip giant reported $86.6 billion in profit over the last four quarters with gross margins near 80%. However, 52% of Q2 2025 sales came from three unnamed customers, likely Microsoft, Amazon, and Alphabet. These hyperscalers are aggressively developing in-house alternatives like Amazon’s Trainium and Microsoft’s Maia to reduce dependency. Morgan Stanley Wealth Management also flagged the risk of high leverage among Nvidia’s customers, noting the complexity of funding clients to maintain growth.