Nvidia Corp’s (NASDAQ: NVDA) Q2 earnings reaffirmed its dominance in the AI infrastructure race, with adjusted earnings and revenue beating expectations and guidance pointing to continued growth above 50%.
While data center revenue narrowly missed expectations, the semiconductor firm’s bullish forecast and commentary on up to $4.0 trillion in AI spending have implications far beyond its own stock.
Two of the biggest beneficiaries? Lam Research (NASDAQ: LRCX) and Milpitas-headquartered KLA Corp (NASDAQ: KLAC).
Both are US semiconductor equipment manufacturers whose fortunes are tightly linked to NVDA’s capital intensity and the broader AI-driven chip boom.
Why Nvidia earnings are bullish for KLAC stock?
KLA, a leader in process control and yield management systems, stands to gain significantly from Nvidia’s continued expansion in AI infrastructure.
The AI darling’s report highlighted a surge in networking component sales and a 17% sequential rise in Blackwell chip shipments – both indicators of increasingly complex chip architectures.
As GPUs become more advanced, the need for precise inspection, metrology, and defect analysis grows exponentially. KLA offers tools that are essential in ensuring these high-performance chips meet stringent quality standards, especially as foundries push for smaller nodes and 3D packaging.
Moreover, NVDA commentary on up to $4 trillion in AI infrastructure spending by 2030 signals a multi-year capex cycle across fabs and hyperscalers. KLA stock, with an entrenched position in front-end and back-end process control, may be a direct beneficiary of that.
Investors should view Nvidia’s results as a green light for KLA’s long-term growth, especially as chipmakers ramp up production of AI accelerators.
With the multinational’s guidance pointing to $54 billion in Q3 revenue, excluding potential H20 shipments to China, KLA shares’ exposure to advanced logic and memory nodes positions them as must-own in the AI supply chain.
Why Nvidia earnings are positive for Lam Research stock
Lam Research, a key supplier of etch and deposition equipment, is another stock tightly correlated to Nvidia’s earnings trajectory.
Nvidia’s Q2 results showed robust demand for GPUs and networking components, with Blackwell chips now accounting for 70% of data center revenue. These chips require cutting-edge fabrication techniques, including high-aspect ratio etching and advanced packaging – areas where Lam excels.
As NVDA’s customers like TSMC and Samsung scale up production of AI chips, LRCX tools become indispensable in enabling the physical structures that power generative AI workloads.
The report also revealed Nvidia’s expectation of up to $5 billion in H20 chip revenue if geopolitical conditions allow. That potential upside may trigger additional wafer starts and packaging demand, directly benefiting Lam Research stock.
Furthermore, NVDA’s $60 billion share repurchase authorization and $9.7 billion buyback this quarter underscore its confidence in sustained profitability – an encouraging signal for suppliers like LRCX that depend on long-term visibility.
All in all, for investors seeking exposure to the AI hardware buildout without chasing Nvidia’s valuation, this semiconductor stock offers a compelling alternative with strong fundamentals and deep integration into the semiconductor ecosystem.
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