300 billion reasons to buy nvidia shares so there’s no tomorrow
After a big run, nvidia(NASDAQ: NVDA) Stocks have not kept up to the entire market in recent months. There are several reasons for this, but the big question for investors is whether it’s time to make Nvidia’s stock price stagnate.
Stocks spiked at around 85% last year, but are lower than four months ago. S&P 500 At the time, there was a total return of about 4%. But now there seem to be more than 300 billion people who buy stocks. This is because several large tech companies plan to spend up to $320 billion on data centers and artificial intelligence (AI) infrastructure over the next year.
Nvidia’s recent success is relatively easy to explain. That advanced AI Graphic Processing Unit (GPU) Chip There is high demand. Revenue for the fiscal year ended late January should show growth of approximately 110% year-on-year, using the soon-to-be-reported fourth-quarter management guidance. That’s particularly impressive considering quarterly revenue is approaching $40 billion.
Nvidia also shared plans with investors for ongoing innovation that should continue to drive demand. Sales of H100 and H200 GPU chips are driving revenue growth, and Nvidia is currently producing Blackwell AI architectures.
CEO Jensen Huang calls Blackwell’s demand “Insane.” Investors will be able to hear the latest information on Blackwell’s sales if Nvidia reports revenue on February 26th. The company may also discuss the next-generation Rubin AI platform scheduled for 2026.
One of the recent headwinds in Nvidia stock was a surprising announcement last month from privately owned Chinese startup Deepseek. The company reportedly High-performance major language model (LLM) Just $6 million. While many have questioned the reliability of its total cost of capital, DeepSeek products have increased uncertainty about how many large tech companies will spend on NVIDIA AI products.
But those companies have not returned to spending. Meta Platform, Amazon, alphabetand Microsoft Each announced its data center and AI infrastructure spending plans in 2025. As a group, the investment totals $320 billion in just one year.
Amazon is set to lead the way with $100 billion in capital expenditures. CEO Andy Jassy said, “The majority of that CAPEX spending lies in AI (Amazon Web Services)”. The Alphabet plans to spend around $75 billion and $65 billion in meta. Microsoft will continue its $80 billion plan in AI investments by June this year.
The company said the investments are already making money. “Already, the AI business has generated annual revenue of $13 billion, up 175% from the previous year,” said Satya Nadella, chairman and CEO of Microsoft. Nvidia is a clear leader in hardware for AI infrastructure and perhaps the biggest benefactor of all capital expenditures.
In addition to those tailwinds associated with AI data center spending, Nvidia has other growing segments. Its gaming business generates the second most revenue. Game revenue has accelerated in each of the last three quarters, reaching its highest level since Nvidia’s quarterly ends on May 1, 2022.
Its professional visualization business provides a platform for creating industrial AI simulations and uses AI to promote the efficiency of industrial developers. Revenue for this segment has more than doubled over the past two years, increasing in each of the last three quarters. Automotive and robot revenues have also accelerated, with each of the periods of the past five quarters growing.
These other business segments use AI and also provide software solutions to NVIDIA’s AI hardware customers. The next generation of AI architectures continue to be improved and utilized in a variety of platform solutions, which will help provide a flywheel effect.
Future quarterly reports could result in stock price volatility, but investors should ask to hold Nvidia for its long-term potential. The pullback that may come from quarterly reports only offers the opportunity to buy more Nvidia stocks.
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Randi Zuckerberg, a former director of market development, Facebook spokeswoman and sister to Metaplatform CEO Mark Zuckerberg, is a member of Motley Fool’s board of directors. John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of the board of directors of Motley Fool. Howard Smith There are positions for Alphabet, Amazon, Microsoft and Nvidia. Motley Fool has positions for Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia, and is recommended. Motley Fool recommends the following options: A $395 phone at Microsoft for January 2026 length and a $405 phone to Microsoft for January 2026 short term. To Motley’s fool Disclosure Policy.
