Nvidia CEO Jensen Huang on Tuesday dismissed a media report that stated Oracle is seeing skinny margins on its enterprise of renting out Nvidia chips to clients. Oracle is “going to do incredibly well,” Huang stated in an interview with Jim Cramer on the CNBC Investing Club’s Monthly Meeting, which was held Tuesday afternoon on the New York Stock Exchange. Shares of software program large Oracle fell as a lot as 5% Tuesday after tech publication The Information reported on the state of Oracle’s Nvidia-centered cloud enterprise amid the excessive price of Nvidia chips and aggressive pricing on AI leases. The inventory finally closed off its lows, down 2.5% to $284.24 a share. According to the report, which cited inside paperwork, Oracle’s Nvidia cloud enterprise generated $900 million in gross sales within the three months ending in August with gross margins of 14%. That was nicely beneath the corporate’s roughly 70% general gross margin. Against that backdrop, Huang provided a extra nuanced perspective, suggesting that short-term margin stress would not be out of the query with new chips. Nvidia’s market-leading AI chips are generally known as graphics processing models, or GPUs. “When you first ramp up a new technology, there’s every possibility that you might not make money in the beginning, but over the life of the system, they’ll be wonderfully profitable,” Huang stated. The Nvidia CEO additionally underscored the operational complexity of working large-scale knowledge facilities for AI computing. “What Oracle does with Nvidia’s systems is not easy,” Huang continued. “These things are giant supercomputers. You’ve got to build infrastructure, you’ve got land, it’s got power, it’s got cooling, and then you have to operate these things.” For its half, Oracle has highlighted that it has booming demand. In September, the corporate stated remaining efficiency obligations — in any other case generally known as its backlog of cloud contracts — jumped 359% 12 months over 12 months in its fiscal 2026 first quarter. That was buoyed primarily by a $300 billion compute take care of ChatGPT creator OpenAI, in response to media stories . Oracle additionally forecasted $144 billion in cloud infrastructure income by 2030, up from simply over $10 billion in 2025. The inventory soared 36% in a single day on these new cloud contracts and long-term monetary projections, whilst quarterly earnings and income missed estimates. The inventory has since dropped about 13%, giving again a few of that surge, amid questions in regards to the sustainability of AI investments. Huang additionally spoke with Cramer about three different key Nvidia partnerships and the significance of America successful the AI arms race .