Nvidia reported great quarterly results Wednesday, but investors are expecting big gains in artificial intelligence over the next decade. The semiconductor company’s market capitalization surged nearly $190 billion Thursday morning after the company announced that revenue for the three months ending in July will be about 60% higher than a year earlier.

Chief executive and co-founder Jensen Huang is a hard man to bet against, given that the company’s profits have grown 20% a year for two decades. But it needs to maintain that pace through 2030 to justify investors’ current hopes.

However, revenue of $7.2 billion for the three months ended April, was down 13% from the same period in 2022. The semiconductor company, which makes crisps for graphics, networking and artificial intelligence system training, said it expects revenue of about $11 billion for the current quarter, up 64% from the same period a year ago.

Nvidia reported earnings of 82 cents per share for the quarter, up 28% from the same period a year ago.

Nvidia is a leader in developing semiconductors that do many simple tasks at once. These French fries are useful for graphics, but are increasingly needed for running data centers and training artificial intelligence systems.

Excitement about the potential of self-learning machines has pushed Nvidia’s market value to $940 billion, more than double what it was at the start of the year.

The only question is whether the company’s financial results can keep up with these inflated expectations. Jefferies analysts, for example, expect Nvidia to post earnings of $6.50 per share in the year ending January 2024, a valuation multiple of nearly 60 times.

The typical semiconductor company is valued at 17 times next year’s estimated earnings, according to Refinitiv.

Let us assume that Nvidia’s earnings continue to grow at 20% annually, even as the company gets larger. By 2030, earnings per share would be about $23, bringing the valuation in line with its peers today. Nvidia’s most recent quarterly guidance suggests much faster growth, but revenue can be volatile: The company’s revenue shrank in each of the last three quarters.

Still, rapid growth is possible. Artificial intelligence is likely a huge opportunity, and Nvidia is essentially the leading supplier of the picks and shovels needed to compete in this gold rush.

If Nvidia continues to grow its bottom line at the same rate as it has in the past, the company would have a profit of nearly $60 billion in 2030. That’s less than Apple will take in this year.

The main argument against Nvidia’s high valuation is simply that 2030 is still a long way off, and many variables along the way could disappoint. AI may not live up to the hype.

Nvidia could lose its technological edge over existing or new competitors. Easiest of all, the next seven years could be anything but golden if investor sentiment worsens.