Nvidia’s recent run-up has sparked optimism about its growth prospects for 2025. The company’s adoption of artificial intelligence (AI) and its pioneering work in graphics processing units (GPUs) have made it a leader in the AI revolution.
As more businesses adopt generative AI, Nvidia is poised to benefit from the growing demand for its specialized chips. The company controls nearly 98% of the data center GPU market, making it an essential component in cloud computing and high-performance computing. This entrenched position has led many analysts to believe that Nvidia’s growth will continue.
Recent financial results have shown that Nvidia’s success is not just a one-time event, but rather a sustained trend. The company delivered record revenue of $35.1 billion in its fiscal 2025 third quarter, with a year-over-year increase of 94%. Its data center segment grew 112% year over year to $30.8 billion.
Wall Street expects Nvidia’s growth streak to continue, with consensus estimates calling for revenue of $195 billion in fiscal 2026, representing a year-over-year increase of 51%. Analysts believe that the company has another market leader on its hands with the upcoming Blackwell platform.
Nvidia’s addressable market is expanding, and the company is taking advantage of this by selling complete racks with all necessary computing resources. This opportunity for revenue monetization is greater than investors appreciate, making Nvidia an attractive stock with a relatively low price-to-earnings ratio of 32 times forward earnings.
Overall, Nvidia’s strong position in the AI revolution and its growing addressable market make it a compelling investment choice for those looking to capitalize on the company’s explosive growth in 2025.
Source: https://www.fool.com/investing/2024/12/07/history-says-the-nasdaq-will-surge-in-2025-1-stock