Artificial Intelligence (AI) arms racing has reached a breakneck pace, pushing tech giants to invest hundreds of billions into building computing power that meets the next era’s demands. Meta Platforms’ CEO Mark Zuckerberg is set to unleash $60 billion to $65 billion in capital spending in 2025, including a massive data center with energy consumption rivaling two nuclear power plants.
This data center, part of Meta’s AI expansion, relies heavily on Graphics Processing Units (GPUs), which are manufactured by Nvidia. The company expects to own over 1.3 million GPUs by year-end and dominates the AI chip market. This demand has propelled Nvidia stock to historic highs, with a meteoric rise of over 550% in the past two years.
Nvidia recently released its Q3 earnings results, outpacing revenue and earnings forecasts. Revenue rocketed 94% year-over-year to $35.1 billion, driven by insatiable demand for its H200 chip, which powers Meta’s AI ambitions. The company expects to double its AI Enterprise revenue in fiscal 2025.
Meta’s spending spree could keep Nvidia’s order books full for years, reinforcing its grip on the AI market. With billions flowing into AI hardware and an insatiable hunger for GPUs, the demand is skyrocketing. As competitors like Google, Microsoft, and Amazon ramp up their AI infrastructure, Nvidia remains the common denominator in this gold rush.
Wall Street analysts are highly bullish on NVDA, with a “Strong Buy” consensus rating overall. The mean price target of $176.90 suggests that Nvidia’s stock could rally as much as 41.9% from current levels. Despite recent selloffs over China’s DeepSeek, many experts view the dip as an opportunity to buy into the AI chip giant’s growth potential.
Source: https://www.barchart.com/story/news/30719239/can-metas-massive-manhattan-sized-data-center-take-nvidia-stock-to-new-record-highs