Track market-moving stories before they get noisy

Nvidia (NVDA -1.43%) has made investors significantly richer over the past four years, turning a $10,000 investment into nearly $179,000 as of this writing.

This massive surge in Nvidia's shares has been fueled by the advent of artificial intelligence (AI). When OpenAI's ChatGPT, introduced publicly in November 2022, became a big hit, companies lined up to buy Nvidia's graphics processing units (GPUs) after it emerged that the semiconductor giant's chips played an instrumental role in training the chatbot.

The AI economy and Nvidia have come a long way since then. AI is now finding its way into several industries, boosting productivity and economic growth. The good news for Nvidia investors is that AI adoption isn't showing any signs of slowing, which explains why the company continues to deliver robust growth even after becoming significantly larger over the past four years.

We will take a closer look at the company's prospects in this article and assess whether investing $10,000 in Nvidia stock over the next five years could be a profitable move.

Image source: Nvidia.

Nvidia is the world's largest company, but it can become even biggerNvidia's AI-driven surge has made it the world's largest company with a market cap of $5.2 trillion. So, expecting another 20x jump in Nvidia's stock price over the next five years would be quite absurd, as it would put its market cap past $100 trillion. However, that doesn't mean Nvidia stock can't climb higher over the next five years.

NVDA Nvidia$214.13-$3.10 (-1.43%)

NASDAQ · As of 4:00 PM ET 10/16/26

After all, the company is still growing at an impressive pace despite the scale it has achieved. Nvidia's revenue in the first six months of fiscal 2027 (which will end in January 2027) increased by 96% over the same period last year to $177.8 billion. The company expects fiscal Q3 revenue of $108 billion, an 89% jump from the year-ago period.

Analysts expect a 91% spike in Nvidia's revenue for fiscal 2027 to $411.6 billion. Meanwhile, earnings per share are expected to almost double in fiscal 2027 to $9.31. Importantly, Nvidia CEO Jensen Huang is confident that the company's growth will continue unabated next year. He recently noted at a conference that the number of chips the company sells will double in 2027, according to CNBC.

Huang added that continued investments in AI infrastructure will drive this incredible growth, as companies and governments look to make the most of the technology's benefits. For example, the World Economic Forum noted earlier this year that AI could increase labor productivity by 1.5% to 3% over the next decade, citing the chief economist of consulting giant EY.

Moreover, investors will do well to note that AI is moving beyond data centers into real-world applications, such as robots and cars. Known as physical AI, Nvidia is pushing into this niche where machines can make complex decisions on their own. From performing precision-related tasks such as threading needles in surgical wards to operating on a conveyor belt, Nvidia is moving into a new frontier that could supercharge its long-term growth.

Nvidia's physical AI offerings are already being used by the likes of Amazon and Japan's national AI venture, and I won't be surprised to see the tech giant pulling in more customers. That's because the physical AI market's revenue is expected to grow to 430 billion euros by 2030, suggesting this niche could move the needle significantly for Nvidia over the next five years.

Throw in the $3 trillion to $4 trillion revenue opportunity that Nvidia sees in the AI infrastructure market in 2030, and it is easy to see why analysts have become extremely bullish about its growth prospects through fiscal 2029 (which will end in January 2029).

NVDA Revenue Estimates for Current Fiscal Year data by YCharts

According to the above chart, Nvidia's revenue could increase by 68% in fiscal 2028, which is almost in line with the company's guidance of 70% growth. That's expected to be followed by a 30% increase in fiscal 2029 to $900 billion. There is a solid chance Nvidia will maintain strong growth in fiscal years 2030 and 2031 as well, which could set the stock up for further gains.

The stock can still deliver impressive gainsLet's assume Nvidia's top line increases by even 10% in fiscal 2030 and 2031 (which will end in January 2031), its top line could reach $1.09 trillion in 2030 (given that fiscal 2031 will coincide with the majority of calendar 2030).

Now, this AI stock trades at 18 times sales. Assuming Nvidia trades at half of this sales multiple after five years, its market cap could jump to $9.8 trillion (based on the $1.09 trillion revenue estimate). That implies a potential upside of 88% from current levels. So, a $10,000 investment in this semiconductor stock will be worth more than $18,800 by 2030.

However, that could be a conservative estimate, as Nvidia could grow faster and command a premium valuation after five years. That's why investors can still consider buying this AI bellwether, as it has the potential to make investors richer owing to emerging niches within the AI ecosystem.

Nvidia's (NVDA -1.43%) rapid ascent to the world's most valuable enterprise might be unlike anything the market has ever seen. In the past five years, its share price has produced an incredible 899% gain (as of Oct. 15). With that return, a $10,000 investment would be worth $100,000 today.

The driver of this has been, unsurprisingly, artificial intelligence (AI). Nvidia's graphics processing units are the leading chips for training and running AI models. And these hardware devices are a hot commodity among the company's customers. Nvidia's data center revenue soared 117% year over year to $89 billion last fiscal quarter (Q2 2027 ended July 26).

A burgeoning industry position in the middle of a generational technology shift is an easy sell to investors right now. History says this AI stock tends to perform well in November, so maybe now is a good time to buy shares. But there's one thing that could break that pattern of positive returns.

Image source: The Motley Fool.

November 2025 was the only negative return This decade, Nvidia has been a compelling portfolio addition in November. In November 2020, shares were up 7%. In November 2021 and 2022, they jumped more than 25%. November 2023 saw a 15% increase, followed by a more muted 4% gain in November 2024.

The bears finally cheered last year. During the 11th month of 2025, Nvidia stock dipped 13%.

Nvidia optimists will take the average return of 13% and conclude that the share price will rise by that much this November. On the other hand, the naysayers will point to the clear deterioration in the stock's monthly performance in recent years. They'll assume shares are set to fall in November.

Investors shouldn't jump to any conclusions, however. The macroeconomic backdrop, as well as industry conditions, seem to have been anything but stable. Then there's market sentiment, which is constantly shifting based on how the investment community is feeling at any particular moment. November could bring anything.

NVDA Nvidia$214.13-$3.10 (-1.43%)

NASDAQ · As of 4:00 PM ET 10/16/26

Hyperscalers are Nvidia's key demand driver Let's still assume that there's a higher probability that Nvidia posts a positive return compared to a loss in November. Instead of taking a victory lap, consider what could break that pattern of upbeat results. In my view, it comes down to one thing.

Nvidia's most important customer cohort contains the five big hyperscalers. Combined, Alphabet, Microsoft, Amazon, Meta Platforms, and Oracle, as well as other hyperscalers, contributed $49 billion to data center segment sales, which as mentioned, totaled $89 billion in the most recent fiscal quarter. These customers are spending tremendous sums of capital to build AI-related technical infrastructure.

The amount of money they allocate to Nvidia products and services depends on how much momentum their businesses have. Specifically, we've seen cloud revenue accelerate for Amazon Web Services, Microsoft Azure, Google Cloud, and Oracle Cloud Infrastructure in recent quarters. Hyperscaler backlogs have exploded, measured cumulatively at more than $2 trillion.

That's an immediate demand signal that helps to alleviate investor concerns about Nvidia's own business strength. Four of the top five hyperscalers will report their third-quarter financial results in the next two weeks. Investors should continue to pay close attention to numbers and commentary related to how their cloud segments perform.

The logic is straightforward. Slower cloud growth gives hyperscalers less reason to keep expanding capital expenditures (capex) at the current pace. And any cuts to forecast capex will negatively impact Nvidia's data center business. Furthermore, market sentiment might plummet.

If the growth decelerates in Q3, it's not exactly a reason to panic. That doesn't automatically start a trend. And the view is that AI is still in the early innings. However, a slowdown could drive fears that the AI boom is starting to cool. That could pressure Nvidia shares.

In this episode of Motley Fool Hidden Gems Investing, Motley Fool contributors Tyler Crowe, Lou Whiteman, and Rachel Warren discuss:

Nvidia's $150 billion buyback plan.The case for a $500 billion buyback.Nvidia's AI safety plan and what the market doesn't like.What to make of all these new defense companies.Mailbag: Thoughts on Klarna?To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on Sept. 28, 2026.

Tyler Crowe: One hundred fifty billion, not that big. Motley Fool Hidden Gems Investing starts now. Welcome to Motley Fool Hidden Gems Investing. I'm your host, Tyler Crowe. Today, I'm joined by long-time Fool contributors, Rachel Warren and Lou Whiteman. We are going to get into the promise and the perils of investing in the defense and security sector. We're also going to hit the mailbag. But we want to start the day with, I guess you could say, the biggest news story, and that was Nvidia. They had a couple of press releases today, one on AI safety and for the investors, perhaps the bigger one is the board of directors announced a $150 billion share repurchase agreement. As a press release says, the biggest in history and gives the board about $250 billion to buy back shares right now. Now, guys, I'm going to give a hot take, and I want to get your quick reactions to this. I think it's way too small.

Lou Whiteman: I mean, look, they're finally off the 1-cent-a-share dividend, which I didn't understand that either. But the law of large numbers just even that's thrown out of proportion here, but nothing is big enough. One hundred fifty billion? Yawn.

Rachel Warren: I mean, it's the biggest in history, but it's also only around 2% of its market cap, so you have to right-size that for the company we're talking about. The other way to look at it is Nvidia is generating tremendous amounts of cash flow from the AI infrastructure buildout. They have more capital than they can logistically reinvest back into R&D. I think that this is a way we're seeing that play out.

Tyler Crowe: I would make the argument that the announcement should be at least triple this. I know that sounds like crazy and probably put me on CNBC.

Lou Whiteman: Well, that's crazy.

Tyler Crowe: I'm not that a tech person. Well, let's put it this way. We could do a CNBC take on this, but I would argue, Number 1, between its valuation, its current debt situation, and as we said, it's only 2% of its market cap. There is an opportunity here for a five point it changes $100 billion a day, so I can't even track what the point is anymore, but five point something trillion-dollar company, this should be somewhere at least 5% of its market cap. If you're trying to wow investors, don't be afraid to use a little bit of leverage. This is a company that made $134 billion in free cash flow. You added one year's worth of free cash flow. Come on, impress me Nvidia. I'm being a little hot take here, but part of the reason I think that they announced this, and I want to get you guys' take on this one, specifically was, in addition to this share purchase, there was a press release related to it's AI safety and perhaps building some guardrails or some safe spaces where we don't get these, AI may have hacked Hugging Face, AI may have hacked the Australian government's health websites. All of these news stories we've been popping up. It was maybe this $150 billion a little bit of, let's help the medicine go down here for our investors.

Rachel Warren: I think that's definitely part of it. I don't think the timing is a mistake by any means. I think that was probably very well coordinated up above, but this is a real industry issue. We’re seeing advanced A models, as you noted, from a wide range of labs, as well as the big hyperscalers that are repeatedly breaching security. Sandboxes, obviously, there's the high profile Hugging Face incident. But we're also at a time where CEO Jensen Huang has been very clear on the approach he wants to take here. He doesn't want to wait for government regulation. He's actually back against that. He's really framed AI safety strictly as an engineering problem that can be managed at the hardware and platform layer.

ust to talk a little bit about what they're doing, Nvidia is introducing an open source framework, it's called OpenShell. They're also introduced a hardware watchdog called Sentry, essentially the idea is these will help quarantine rogue software within milliseconds. OpenShell is interesting. It's open source, as its name indicates, it's designed to support rival platforms from ARM and Intel. You can see how Nvidia is trying to establish a universal industry standard for safety. They want to lower the risk barrier for enterprise adoption before maybe you see more corporate security teams or regulators freeze the deployment of autonomous AI agents. I think that they're very much trying to get ahead of the curve here.

Lou Whiteman: Back to the investing question. I think they're couching bad news with good. But also, look, this is part of a trend, Nvidia has run out of ways to wow the market. Jensen increasingly he looks like the greatest showman. He knows how many times he now goes on stage to just make bold pronouncements. The stock has done nothing basically, since the spring. Amazing earning reports are just being met with yeah. I think, look, this is a great business, but the perception is, whether it's AI doomerism they're trying to push back against or just investor boredom, Nvidia has run out of ways to wow or excite investors. I think the big buyback, this is just another maybe failed attempt to say, remember us, we're still really good.

Tyler Crowe: Well, guess what? If you're the CFO and you really want to wow investors, $500 billion buyback, that's going to be by pitch to them. But to that point though, Nvidia trades for about 18 times its earnings estimates for next year. It's the cheapest in a decade. A nice or a little quib I like the market is irrational, but it isn't dumb. There is some risk building here that maybe we're not seeing. What may those risks be that investors might want to consider that are maybe hidden that most people aren't thinking, of course, there's cyclicality in this industry, but what are some of maybe people aren't considering this one as much?

Rachel Warren: I think there's a few things to consider. I mean, one is the circular funding. This isn't hidden, this is something that's been talked about a lot. I mean, we look at that number that Invidia just announced today. They’ve disclosed that Anthropic’s aggregate contracted value across NVIDIA-backed cloud entities has scaled above $180 billion alone. That's just in their arrangements with Anthropic. Nvidia’s balance sheet includes 13 public stakes, over 200 private stakes, $20 billion in data center lease commitments. They're operating essentially like a central bank for a lot of the AI industry. Part of that is a function of necessity. Obviously, the idea is that that flows back into the growth story for Nvidia.

But there's that circular funding mechanism that I think is concerning depending on if or when the build-out slows down. One other thing to note, hyperscalers are writing off these AI GPUs on aggressive 3-5-year life cycles. They're operating under the assumption that there's going to be these constant multi-billion dollar upgrades. But what if you have a GPU that's a few years old that ends up being perfectly adequate for 80% or more of enterprise inference workloads? That upgrade cycle could be much slower. If that happens, you could see companies like Nvidia face a bit of a cliff or at least a slowdown in growth, even if it's a distant one. I mean, essentially, this idea, not that the technology fails. If the existing hardware works too well, you could start to see Nvidia frozen a little bit out of its own upgrade cycle. That's the extreme case, but I do think it's something that if you're an investor in Nvidia, if you're looking at Nvidia right now, these are a couple key factors you need to be incorporating into your investment thesis.

Lou Whiteman: I think there's a pretty not-extreme straightforward case to say that the best is now behind them for the AI cycle. Not that it can't be really good for a long time. But Google, Amazon, Microsoft, Meta, OpenAI, they're all at least trying to make their own chips. No one is going to stop doing business with Nvidia, but Wall Street pays for growth, if there's more competition coming in, I didn't even mention the other chip companies, that is going to put a cap maybe on upside growth. Also, if the frontier models don't matter as much, and I think evidence is growing that they don't matter as much, then does having the latest, greatest, newest, most expensive chip matter as much at the scale we hoped? You say it's boring, but it does matter. Cyclicality is a thing. As recently as 2023, Nvidia was generating earnings per share under a dollar per year; now it’s at eight. It may look cheap on a price-to-earnings basis, but there is a question of is this level of earnings per share, how long could it go on? If not, that multiple looks a lot different.

Tyler Crowe: Well, you know what brings up that earnings per share? Five hundred billion dollars by ABAC. I am going to solve this one into existence. Coming up for the break, we're going to talk about the defense and security industry.

REDLattice is a cybersecurity company that's going public via SPAC. It expects to merge with a company that's called Bold Eagle Acquisition Corp., and it's going to conclude sometime around the end of 2026. It's expected to go public at around 1.25 billion. I would say the layman's way to describe it is it's a competitor to Axon Enterprise and Cellebrite in cracking encrypted devices and other sensitive information processing. There's quite a few of these companies starting to pop up in the defense industry and the company itself isn't why I bring this topic up, though, it's making its rounds on the financial media rings. I think that this is indicative of a shift in the market's attitude towards defense tech and somewhat related space companies. For much of the 2000s, 2010s, the defense industry was consolidating. It was fewer players and those giants to me, they weren't that far removed from utility companies in terms of growth, earnings, what have you in terms of the returns.

For a myriad of reasons, that's changed, and there is bound, I think, to be a fair share of companies going public in this space, some of which are going to be lower quality companies, very similar to what we saw with SPACs in 2021 in the fintech technology consumer tech region. Lou, you've done defense for a little while. Rachel, you've given some thoughts on this as well. When you're looking at IPOs for defense-related companies, we're going to see a lot of them. What are some of the specific traits to defense investors should look for?

Lou Whiteman: Well, let's start real quick outside of defense. Just why do companies go public via SPAC? The big thing is, is that a SPAC is technically a merger, and SEC rules give you a lot more leeway to talk about the future in a merger than they do in an IPO. That matters if you don't have much of a past to talk about. We are talking about early-stage companies that really want to talk about the future. That fits in real well. As far as defense-specific, the Pentagon has been talking about diversity a lot, but it doesn’t want to deal with these companies; it really doesn’t. What am I looking for? I'm looking for on RAMS. I'm looking for companies that work with companies that have direct access, whether it's the primes, whether it's this new generation. But it is not easy to get in the cool guys’ club at the Pentagon. A lot of these, even if their technology is better, are just not going to generate the revenue that they hope to if they aren't in the room.

Tyler Crowe: Lou, I'm going to stop you for a quick sec. Just for everyone who's not a super defense, sicko, what is a prime? Because I am sure there's some people thinking, what is that?

Lou Whiteman: The prime contractors are, well, I mean, for the most part, we think of them as Lockheed Martin, Northrop Grumman and the big mass of guys, but they're smaller ones, too, but basically, they are the ones in the room. They are the ones with direct contacts and contracts with the Pentagon. They're called primes because literally, the Pentagon does business with them, and then they just dole out revenue to other companies that work with them. Another thing you've got to consider here is most of these defense tech companies just have some novel tech and it looks like wow, and it looks like they're the only ones who can do this. There is a ton of government-funded R&D going on with the inside the established contractors. Because it's classified, they don't talk about it much and they don't have a need to talk about it the way you do if you have an IPO. I've seen numerous companies basically fail because what looked to be unique or looked to be something they could only do was actually yesterday's news on the inside.

It's really, you can't do due diligence here because so much of it is classified, but just be aware that if the first thing you think is, why did anyone think about this? That might be a yellow flag. Also, and again, you just can't say this enough that just the idea of how you get in the room. For most of these companies, working with the government is a core competency. It's really hard to deal with government bureaucracy and most companies can't. It is a skill to be able to navigate this. I don't want some Silicon Valley dudes with an idea. I want at least someone in leadership, whether it's a chairman or something that has government related experience. Related, you need a big employee base with security clearances. If you don't, you can demo whatever you want, but you're never going to get to interact with the defense chain. Those are just some yellow flags to look at when you're looking at these.

Tyler Crowe: Rachel, Lou gave the lay of the land here, and there's some red flags, yellow flags, things that clearly you want to see. When you're looking at this as well, what do you think are some of the pitfalls or minefields that are specific to the defense industry playing off what Lou was talking about here?

Rachel Warren: I mean, I think there's a few things to watch for. One, Lou alluded to this, it's dangerous to assume that a successful high-profile prototype or even a small business innovation research grant is going to easily convert into an official, military or defense program of record. There are many young firms that burn through their entire capital reserves and collapse while waiting 2-3 years or more it typically takes for the Pentagon to officially allocate full production funding in the federal budget. That's one thing to be aware of as well. Often a defense company’s fastest-growing and highest-margin business segments are wrapped in classified or special access programs. Management is legally forbidden essentially from disclosing a lot of the granular details. Investors often have to model future revenue while being very blind to the exact contract terms, customer identities, underlying unit economics. That is part of the nature of the beast when it comes to looking at potential IPOs in the space or, in some cases, younger public companies that have risen through the ranks and aren’t those typical prime names that we think about.

Tyler Crowe: I was alluding to, there's a lot of companies we expect to go public in this space and not to bring up one where it's like the Silicon Valley bros that Lou was talking about, but Anduril and I hope I pronounce it's Anderl, Anduril, depends on who you ask in terms of pronouncing, Anduril. They're expected to go public relatively soon. There's a will they, won't they with Blue Origin, the space company supported by Jeff Bezos. Some of those are the big name grabbers in terms of IPOs that could happen sooner or later. Is any of these companies on your radar either it being Anduril, Blue Origin, or maybe some mysterious third company that people haven't heard about yet?

Lou Whiteman: Anduril is a good example of something that Rachel was talking about. I would argue they look more impressive than they are because they are allowed to talk about everything they're doing and the ones inside the tent aren't, so be careful there. I'd honestly be surprised if either they or Blue Origin go public anytime soon. Ursa Major, which is in pending SPAC. They're so similar to what's going on with REDLattice. They're interesting. They do rocket and missile propulsion systems. Shield AI is similar to Anduril. I think it's actually more advanced than Anduril. I think they're more likely to go public. I'm worried about the valuation there, but I'd be intrigued if they came out.

Rachel Warren: Anduril is definitely one on my radar. I think they're one of the key players in the modern defense tech asset class. I mean, they've definitely moved past the speculative start-up phase. They're building out some pretty impressive operations from what we can see. There's the Arsenal-1 hyper manufacturing facility in Ohio. This is specifically designed to mass produce autonomous military hardware like software to find drones and underwater vehicles. I'll say the founders have been very disciplined about avoiding a premature public debut to the market, so that may be something that we continue to see pushed back for the foreseeable future. Earlier this year, they announced a major 10-year U.S. Army enterprise contract worth up to $20 billion. Another green flag for the business. Whether it goes public in the coming months or in the next few years, definitely one that I have top on my radar.

Tyler Crowe: I don't know how long it's going to take, but just hearing the words SPAC still just has, like, the hairs on the back of my neck, just like perk a little bit. Well, just seeing all the scars of what happened with 2021, I don't know how long that's going to be. But, Lou, you were mentioning a couple of those ones, Ursa Major being a SPAC merger. I don’t know; I was like, as good as it is, I still can’t get over that bad feeling in the back of my head. Hopefully, Ursa Major can prove me wrong. Rocket Lab, fair enough. Coming up after the break, we're going to hit the mailbag.

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Tyler Crowe: Hey, everyone, quick reminder, if you want to get a question into us, email us at [email protected]. That's podcast with an S. We've also got the email in the show description below. Today's question comes from Cam, and we've been talking a little bit about fintech. Lou, you went a little hard on them last week about it being a tough business, but Cam's question is in the fintech industry. He has a question about Klarna. He says this is going back to its most recent earnings. It looked like a blowout quarter. Every metric was up and up significantly, but the stock dropped 20%. This, I think, the email was right around the time of Klarna's earnings. It looks like this is a challenger to traditional credit card companies and like it is making great strides. The price-to-sales ratio seems low. Market cap seems to have a lot of room for growth, and it seems that they are now profitable. What am I missing? Cam, thanks for the question. What do you guys think?

Rachel Warren: I think there's a few things going on here. I wouldn't necessarily position Klarna as a key competitor that's going to outpace the traditional credit card companies. I don't think they have to. But there were a few reasons why the stock has been under pressure recently, especially after their earnings. They delivered a billion dollars in revenue. That was up almost 30% year over year. They actually turned a surprise net profit of about 9 million dollars, but they lowered their full-year revenue outlook. That came in quite a bit below the consensus estimate that analysts had modeled, and management essentially said that they're seeing a major slowdown in discretionary consumer spending in Germany. Well, that matters because Germany is Klarna's largest most profitable region. They said there was a $600 million foreign currency translation headwind.

At the same time, Klarna unexpectedly announced that both their chief financial officer and their chief marketing officer are leaving the company early next year. A series of bad announcements. The market didn't like it. On the positive side, their U.S. business is expanding rapidly. But I think investors are unhappy with the fact that the very mature, historically higher-margin European business, that's softening a lot faster than Wall Street had anticipated. Now, if management stabilizes those operations and continues to expand in the US, I think buying at these levels could be a compelling choice for long-term investors personally. But that's some of the machinations going on behind the stock important to be aware of if you're going to be a buyer.

Lou Whiteman: The market is always forward-looking, and the posted numbers were fine, but there was a lot of dark clouds or gray clouds into the future. You throw in the fact that the entire buy now, pay later industry has never had to underwrite through a real downturn. I think that there's reason and I'm not saying they'll fail, but I think we just don't know, and we need to accept that and not overvalue these things. I do think there's a real business there. I do think actually it cuts into credit card volumes over time. But look, I'd like to see more of a market cycle playout here before I buy any of them, and if I was going to buy a buy now, pay later, I don't think Klarna would be my first choice.

Tyler Crowe: It seems too, we discussed this with the recent announcement that Nubank and Revolut are going to be coming into the United States, where we're getting these blurred lines, you will, of the new fintech or traditional banks. They're all attacking the same target audience and starting to look more and more like each other, so it'll be curious. Even though they're technically not competitors, all of these other entrants coming into the market are just going to make much that many more like gross merchandise volume or, customer uptick. It's just going to be that much harder. To your point, Lou, anything that's in the financial industry going through a credit cycle, good or bad, you almost want to feel like you want to wait for at least one or two to see who actually gets weeded out for the good or the bad.

As always, people on the program may have interest in the stocks they talk about, and The Motley Fool may have recommendations for or against, so don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards is not approved by advertisers. Advertisements are sponsored content and provide for informational purposes only. To see our full advertising disclosure, please check out our show notes. Thanks to our producer Dan Boyd and the rest of The Motley Fool team. For Rachel, Lou and myself, thanks for listening, and we'll chat again soon.

Bank of America just invoked the ghost of the 1990s fiber optic collapse to explain why AI's biggest winners could still leave investors with nothing, even if the technology reshapes the world exactly as promised.

Railroads transformed America and fiber optic cable built the internet, yet many investors who funded both lost money. In a note reported on October 16, 2026, Bank of America investment strategist Sebastian Raedler argued AI is tracking the same path, writing that “most major capital cycles of the past have ended in disappointment, even though the underlying technology often lived up to expectations.”

Raedler argues that AI’s technology can succeed while investors in AI stocks still earn poor returns. Sebastian Raedler said 12-month forward consensus hyperscaler capex expectations rose from $330 billion in early 2025 to $1 trillion. Those figures forecast spending by the largest cloud operators over the next year.

The Nasdaq 100 fell 2.5%, and the Philadelphia semiconductor index posted its eighth straight loss, its longest run since 2008. After Bank of America’s note, NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) slid 1.43% to $214.13, a market value of $5.17 trillion. On Raedler’s warning, Microsoft (NASDAQ:MSFT) fell 1.93% to $529.05, and its market value slipped below $4 trillion to $3.93 trillion.

How Capital Cycles Punish Investors In a capital cycle, strong profits pull in a wave of investment until capacity exceeds demand. Prices then fall as competitors fight for customers, and returns on capital sink.

Railroads in the 1870s and fiber networks in the 1990s followed that pattern, and many builders went bankrupt even as their track and cable served the economy for decades.

The trick in any mania is planning the exit while it still runs, which we laid out in a free handbook here. Raedler put forward hyperscaler capex expectations at 3% of US GDP, above the 2.2% of the 1870s railroad boom and the 1.1% of the 1990s tech boom.

Falling Token Prices Hit Both Sides of the Trade A token is a piece of text an AI model processes, and providers charge per token. Sebastian Raedler said average token prices have fallen around 50% since the summer.

When the price of each unit falls faster than volume grows, revenue stalls even as usage booms. Business AI spending data from Ramp, cited in the report, show spending has faded slightly since August while token volumes keep rising.

Raedler named the culprit. He wrote, “This monetization disappointment in the face of intense competition is precisely the failure mode seen in past capital cycles.”

Microsoft sells AI capacity through Azure, so cheaper tokens pressure its pricing, and its fiscal 2026 capex reached $115.95 billion while free cash flow fell to $66.99 billion. NVIDIA’s fiscal third-quarter revenue guidance of about $108.0 billion depends on those hyperscaler budgets holding.

Amazon (NASDAQ:AMZN) closed at $250.00. Alphabet (NASDAQ:GOOGL) Class A fell 2.47% to $340.59, and Meta Platforms (NASDAQ:META) dropped 3.72% to $709.33.

Bank of America’s note cited a 20% drop in Korea’s KOSPI since early October and the chip index at 13% below its recent high that morning. Chips fell further later.

Which AI Stocks Face the Most Pressure From a Spending Pullback The bull case: NVIDIA is up 15.08% in 2026 despite a 6.61% drop in the week ended October 16, and Microsoft gained 7.9% over the month. Raedler’s warning targets investor returns and stops short of a crash forecast.

Suppliers paid upfront look safer, yet the bear case hits them hardest. NVIDIA’s sales depend on AI capex budgets, so any trim to Sebastian Raedler’s $1 trillion forward expectation hits its revenue directly, at 43 times trailing earnings.

Microsoft holds up better. Most of its capex buys short-lived chips that its finance chief said could slow if demand changes; cheaper tokens lower costs for its own Copilot products, and it trades at 29 times earnings.

My view: among AI stocks, Microsoft looks better positioned than NVIDIA to weather a slowdown in AI spending. The trigger to check is Microsoft’s next earnings report against guidance of about 45% constant-currency Azure growth, because a miss would show the token squeeze reaching a major seller of AI capacity.

Contact [email protected] for any questions or corrections.

Covington Investment Advisors Inc. boosted its position in shares of NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 2.1% during the second quarter, according to the company in its most recent Form 13F filing with the SEC. The institutional investor owned 163,112 shares of the computer hardware maker’s stock after purchasing an additional 3,413 shares during the quarter. NVIDIA makes up 4.2% of Covington Investment Advisors Inc.’s portfolio, making the stock its 4th biggest holding. Covington Investment Advisors Inc.’s holdings in NVIDIA were worth $32,637,000 at the end of the most recent quarter.

Several other large investors also recently bought and sold shares of NVDA. Jupiter Topco LLC acquired a new stake in shares of NVIDIA in the second quarter valued at approximately $16,156,076,000. Van ECK Associates Corp raised its position in shares of NVIDIA by 34.7% in the 2nd quarter. Van ECK Associates Corp now owns 75,849,721 shares of the computer hardware maker’s stock worth $15,176,771,000 after buying an additional 19,522,304 shares during the period. Amundi raised its position in shares of NVIDIA by 10.4% in the 1st quarter. Amundi now owns 133,768,018 shares of the computer hardware maker’s stock worth $23,329,141,000 after buying an additional 12,575,177 shares during the period. SEB Asset Management AB purchased a new position in shares of NVIDIA in the 1st quarter worth $1,692,807,000. Finally, Employees Provident Fund Board acquired a new position in NVIDIA in the fourth quarter valued at $1,243,336,000. Institutional investors and hedge funds own 65.27% of the company’s stock.

Key Headlines Impacting NVIDIA Here are the key news stories impacting NVIDIA this week:

Positive Sentiment: New RTX Spark laptops expand NVIDIA’s addressable market. Systems from ASUS, Dell, HP, Lenovo, Microsoft and MSI are now available starting at $2,599, combining Blackwell graphics, up to 128GB of memory and local AI capabilities. The launch could create a new consumer and developer revenue stream beyond data centers. NVIDIA RTX Spark PCs Available Today Positive Sentiment: Automotive and enterprise adoption continues. Volvo expanded its partnership with NVIDIA for automated-driving systems, while Adobe is integrating NVIDIA technology across Photoshop, Premiere and other creative tools. These agreements support longer-term demand for NVIDIA hardware and software. Volvo Cars expands automated driving partnership Positive Sentiment: Supply-chain investment and customer deployments remain strong. Taiwan is reportedly considering as much as $4 billion for Texas industrial parks serving NVIDIA suppliers, and customers continue deploying Blackwell systems. The developments reinforce demand, although they may take time to affect revenue. Taiwan Texas industrial parks Neutral Sentiment: NVIDIA is broadening its software and AI-model ecosystem. Paid offerings such as AI Enterprise and Mission Control, along with Nemotron open models and partnerships with AI startups, could make earnings less dependent on hardware. However, the articles provide no near-term financial contribution. Negative Sentiment: AI financing concerns are the main pressure. CoreWeave’s debt has reportedly traded at distressed yields, raising questions about whether highly leveraged customers can continue funding data-center expansion. Higher Treasury yields and inflation concerns are also making large AI projects more expensive. CoreWeave financing worries Negative Sentiment: Investors are questioning AI growth expectations. OpenAI’s reported $50 billion revenue run rate was below the roughly $68 billion previously anticipated, prompting concern that AI demand may mature more slowly. Microsoft’s development of custom Maia chips also highlights the risk of customers developing alternatives to NVIDIA GPUs. OpenAI revenue expectations Negative Sentiment: Reported insider selling adds a sentiment overhang. Recent data showed NVIDIA insiders made numerous sales and no open-market purchases over the past six months, though such transactions may reflect planned diversification rather than a change in business outlook. Insider Activity at NVIDIA In other news, Director Mark A. Stevens sold 622,239 shares of NVIDIA stock in a transaction that occurred on Friday, September 4th. The shares were sold at an average price of $231.62, for a total value of $144,122,997.18. Following the transaction, the director owned 2,336,531 shares of the company’s stock, valued at $541,187,310.22. This trade represents a 21.03% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, EVP Timothy S. Teter sold 30,460 shares of the firm’s stock in a transaction on Monday, September 21st. The stock was sold at an average price of $222.80, for a total value of $6,786,488.00. Following the completion of the transaction, the executive vice president directly owned 2,687,660 shares of the company’s stock, valued at approximately $598,810,648. This trade represents a 1.12% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 1,766,118 shares of company stock valued at $399,450,353 over the last ninety days. Insiders own 3.94% of the company’s stock. NVIDIA Stock Down 1.4% Shares of NVIDIA stock opened at $214.13 on Friday. The company has a quick ratio of 3.85, a current ratio of 4.59 and a debt-to-equity ratio of 0.14. NVIDIA Corporation has a fifty-two week low of $164.27 and a fifty-two week high of $243.37. The business has a 50-day moving average price of $223.20 and a 200 day moving average price of $211.10. The firm has a market cap of $5.16 trillion, a P/E ratio of 31.48, a P/E/G ratio of 1.67 and a beta of 2.22.

NVIDIA (NASDAQ:NVDA – Get Free Report) last released its quarterly earnings data on Wednesday, August 26th. The computer hardware maker reported $2.22 earnings per share for the quarter, topping analysts’ consensus estimates of $2.09 by $0.13. The business had revenue of $96.22 billion for the quarter, compared to analysts’ expectations of $92.27 billion. NVIDIA had a net margin of 63.66% and a return on equity of 96.04%. The company’s revenue for the quarter was up 105.9% compared to the same quarter last year. During the same quarter last year, the company earned $1.05 EPS. On average, sell-side analysts forecast that NVIDIA Corporation will post 9.27 earnings per share for the current fiscal year.

NVIDIA declared that its board has approved a stock repurchase plan on Monday, September 28th that permits the company to buy back $150.00 billion in outstanding shares. This repurchase authorization permits the computer hardware maker to purchase up to 2.8% of its shares through open market purchases. Share repurchase plans are often a sign that the company’s leadership believes its shares are undervalued.

NVIDIA Announces Dividend The firm also recently declared a quarterly dividend, which was paid on Thursday, October 1st. Shareholders of record on Thursday, September 10th were given a $0.25 dividend. The ex-dividend date was Thursday, September 10th. This represents a $1.00 annualized dividend and a yield of 0.5%. NVIDIA’s payout ratio is 12.64%.

Wall Street Analyst Weigh In A number of equities research analysts have issued reports on the company. China Renaissance boosted their price target on NVIDIA from $319.00 to $330.00 and gave the company a “buy” rating in a research report on Monday, August 31st. HSBC raised their price objective on NVIDIA from $360.00 to $365.00 in a report on Thursday, August 27th. Rothschild & Co Redburn raised their price objective on NVIDIA from $300.00 to $325.00 in a report on Thursday, August 27th. Phillip Securities lifted their price objective on NVIDIA from $285.00 to $300.00 and gave the company a “buy” rating in a research note on Monday, August 31st. Finally, Rosenblatt Securities reiterated a “buy” rating and set a $390.00 target price on shares of NVIDIA in a report on Tuesday, September 29th. Five investment analysts have rated the stock with a Strong Buy rating, forty-nine have assigned a Buy rating and one has given a Hold rating to the company’s stock. According to data from MarketBeat.com, NVIDIA currently has a consensus rating of “Buy” and a consensus target price of $321.89.

Read Our Latest Research Report on NVIDIA

NVIDIA Profile (Free Report)

NVIDIA Corporation is a technology company that designs accelerated computing platforms, graphics processing units (GPUs), central processing units (CPUs), networking products and related software. Its technologies are used in artificial intelligence, data centers, scientific and technical computing, gaming, professional visualization, automotive systems and robotics.

The company’s products include GeForce GPUs and gaming software, data center computing platforms, networking solutions, and enterprise software for AI development and deployment.

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The "Magnificent Seven" stocks have powered the S&P 500 higher over the past several years, thanks to their leadership in the technology space and, in many cases, their prominence in the high-potential area of artificial intelligence (AI). These companies operate across a range of specialty areas, from smartphones to social media, and each dominates its field -- and has established a strong track record of revenue growth over time.

You would expect such stocks to be particularly expensive after their gains in recent years. But that isn't the case. In fact, one stands out as a once-in-a-decade buying opportunity, as the cheapest of the "Magnificent Seven," and it's also close to its own valuation low. This AI stock has soared more than 900% over the past five years and is well-positioned for further gains as the AI story continues to unfold. Let's check out this surprisingly cheap stock to buy now, before the price goes up.

Image source: Getty Images.

Seven well-known tech giantsSo, first, let's take a quick look at the "Magnificent Seven." Most of us are probably familiar with these names, as they have built their reputations and businesses over time, and in most cases, their products are in the public eye. These companies are: Apple, Amazon, Alphabet, Meta Platforms, Microsoft, Nvidia (NVDA -1.43%), and Tesla.

Investors have rushed to get in on these stocks in recent years to bet on the AI story and technology in general. At times, valuations reached high levels, but today, many of them, in spite of the positive stock performance, are trading at reasonable prices. This is as earnings have also taken off.

And the best bargain of the bunch just so happens to be the biggest AI winner of all, at least so far, and that's Nvidia. The company trades for 23x forward earnings estimates, making it even cheaper than Meta, a stock that's been among the cheapest of the "Magnificent Seven" in recent years.

META PE Ratio (Forward) data by YCharts

Now, here's why I think such levels won't last and that this is a once-in-a-decade buying opportunity. We'll start by talking about the business Nvidia has built. The company is known for its graphics processing units (GPUs), the chips needed for essential AI tasks like the training of models. The GPU and Nvidia's related products and services have generated enormous earnings growth, with revenue and profit each climbing in the double and triple digits quarter after quarter. In the latest period, they reached $96 billion and $59 billion, respectively.

Why customers like the fastest GPUsCustomers rush to Nvidia because its GPUs are the fastest, and this is a major plus -- speed equals efficiency and over time may lower costs. Nvidia has expanded its repertoire as the AI boom has evolved, positioning itself to win in the upcoming phases of growth, and, with this in mind, it recently made a key move.

NVDA Nvidia$214.13-$3.10 (-1.43%)

NASDAQ · As of 4:00 PM ET 10/16/26

Nvidia has entered the stand-alone central processing unit (CPU) market as CPUs are seen as the key chips powering agentic AI. This involves AI handling real problems and taking multi-step actions, and it's viewed as a big growth driver in the coming years. Nvidia says the stand-alone CPU market is worth $200 billion, and the company aims to become a leader.

So, Nvidia's explosive growth in the early stages of the AI boom may not be the end of the story. The company could be heading for another big wave of growth as agentic AI use gathers momentum. Nvidia is in the process of rolling out its first CPUs and expects $20 billion in revenue from them this year alone. This offers us reason to be optimistic about what's ahead.

While Nvidia's explosive growth may keep its valuation somewhat in check, I still see today's level as exceptionally cheap -- and possibly a once-in-a-decade opportunity for growth investors looking for a long-term AI victory.

Nvidia (NVDA -1.43%) may be the world's largest company by market cap, but that doesn't mean that its sales and earnings can't get bigger. However, if you look at how the stock market is valuing the company, then it's pretty obvious that the market thinks they won't.

This gap is a major investment opportunity, because if you know which metrics to look at, you can easily discern that Nvidia should soar over the next year. That makes it one of the top stocks to buy now.

Image source: The Motley Fool.

The market isn't baking in any of 2027's growth The metric I'm focusing on here is next year's forward price-to-earnings (P/E) ratio. For a rapidly growing company like Nvidia, this makes a lot of sense. Though it's based on estimates, this metric is actually fairly solid, as Nvidia has already told investors that it expects 70% revenue growth next year. Nvidia can make forecasts like that with some confidence because many AI hyperscalers have already locked in their capital expenditure plans for next year, as these decisions must be made well in advance. Contracts for chips have to be signed early if those cloud computing companies are going to ensure that when their new data center facilities have been constructed and connected to power, they'll have the chips and servers they need.

With that in mind, calculating what Nvidia's earnings will look like next year is fairly easy. If Nvidia hits Wall Street estimates for next year, and its stock doesn't move in price from now until then, it will trade for less than 14 times earnings.

NVDA PE Ratio (Forward 1y) data by YCharts.

That's an incredibly cheap price, and it's unlikely that Nvidia will trade at that range. Currently, its trailing P/E ratio is 28, which is quite reasonable for a company of Nvidia's caliber. As a result, I think there's a lot of upside to be had.

If Nvidia meets its earnings growth expectations and also trades at 28 times earnings at the end of its next fiscal year (ending January 2028), the stock would double between now and then. Picking up a stock that has real potential to double in a year and a half is a great investment move, and given Nvidia's great long-term visibility into what its clients will be spending, there's good reason to trust in that potential.

NVDA Nvidia$214.13-$3.10 (-1.43%)

NASDAQ · As of 4:00 PM ET 10/16/26

Some investors may be worried about how much the AI hyperscalers are spending, but they're still going to spend massive amounts of money on AI computing. There's too much at stake for them to risk falling behind their peers, and with several of the cloud computing providers stating that they have hundreds of billions of dollars in demand backlog, I think the AI companies will stay aggressive in their spending for a while, benefiting companies like Nvidia.

Jensen Huang, CEO of Nvidia.

Bloomberg/Getty Images

Nvidia's communications organization has been reshaped as the company became the face of the AI boom, with multiple teams brought under new leadership and a string of departures.

Business Insider identified roughly 15 communications employees who have left Nvidia since 2025, based on LinkedIn profiles and interviews with former employees.

The organization now numbers roughly 70 to 80 people globally, and has more than doubled in size since Mylene Mangalindan joined as vice president of corporate communications in 2023, according to a person close to the company.

The departures have also included newer hires. Anna Soellner, who was recruited to lead corporate communications, left after roughly four months, Business Insider previously reported.

Nvidia is known for high retention. It reported companywide turnover of 3.7% in fiscal 2026, up from 2.5% the prior year, and well below the tech industry average of 21.9% cited in its latest sustainability report.

Mangalindan succeeded longtime communications chief Bob Sherbin, who retired in 2024. She previously worked at the advisory firm Brunswick Group.

She was brought in to "bring fresh blood" and "upgrade the team" to meet Nvidia's growing profile, one former employee said.

At the end of 2024, Nvidia restructured its communications organization. It brought enterprise public relations under Mangalindan's leadership alongside the corporate communications team she already led, according to two former employees.

Corporate communications focuses on Nvidia's reputation and major media outlets, while enterprise handles product and industry messaging, including for its data center business.

One former employee said the consolidation reflected the growing importance of Nvidia's data center business, which sells chips and systems that power AI and had become its biggest revenue driver.

Analyst relations, social media, and influencer marketing also moved under Mangalindan's remit this year, another former employee said.

Three former employees said Nvidia's communications team had long operated with relatively lean staffing, even as workloads grew alongside the company's public profile, leaving staff juggling multiple responsibilities.

These employees said they experienced long hours, difficulty taking time off, and pressure to respond quickly to emails and Slack messages.

A person close to Nvidia said the company's lean staffing allows employees to move quickly and also requires long hours. The person said Mangalindan encourages staff to take vacation, though the team's small size can make scheduling time off difficult, particularly in the summer.

Nvidia is widely known for its demanding work environment. CEO Jensen Huang has emphasized operating at the "speed of light" and is known for fostering a culture of constant accountability.

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Geoff Weiss is a senior reporter on Business Insider’s tech team, where he covers Nvidia and AI infrastructure. His reporting focuses on the business of AI compute, emerging startups, and the people and strategies shaping the industry.Previously, Geoff was on the media desk, covering YouTube and Netflix, and themes like the intersection of Hollywood and the creator economy. His work on Netflix’s video podcasting ambitions and Mr Beast’s lessons for Hollywood won second and first prize, respectively, at the 2025 LA Press Club Awards.Prior to joining Business Insider, Geoff was the senior editor of Tubefilter and a staff writer at Entrepreneur. He graduated from New York University with a degree in English Literature.He can be reached at [email protected], on Signal @geoffweiss.25, and on LinkedIn. Have a tip? Use a personal email address and a nonwork device; here's our guide to sharing information securely.

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AI founders face consequential choices about which models to use, what technology to own, and where to invest their resources. NVIDIA's Nader Khalil, Director of Developer Tech, and Sydney Sykes, Global Head of VC Partnerships, explore how those decisions shape how startups are built and funded, including the tradeoffs between open and proprietary models and how cost and control influence strategy.

Nvidia is quietly signing deals with some of the world's biggest automakers, and its self-driving platform looks remarkably like Tesla's most prized technology. The question now is whether Tesla's brand can hold off a rival that plays for the entire…

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Nvidia (NASDAQ: NVDA | NVDA Price Prediction) announced a deal with Volvo yesterday. Volvo is far from one of the world’s largest car companies. However, Zhejiang Geely Holding Group, which owns it, is a player in the Chinese car sector—the world’s largest car market by far. The Nvidia product sounds and looks a lot like Tesla’s (NASDAQ: TSLA) self-driving feature. Tesla is working hard to roll out the product and hopes to gain approval in several countries soon.

New Volvos will have what it calls “eyes-off and mind-off.” InsideEVs reports, “By using Nvidia’s Hyperion platform, which includes custom high-powered chips and a full suite of sensors mounted around the vehicle, Volvo says its new point-to-point system will offer Level 2++ functionality.” The technology is also part of partnerships with Mercedes and Hyundai. Tesla has the equivalent of Level 2++ in its “Full Self-Driving (Supervised)” product. Nvidia’s product equals that. Volvo’s product launches in three years, which puts it at a disadvantage.

Of course, Tesla’s technology only works on a Tesla. Nvidia can eventually claim the advantage of partnerships that could extend to many manufacturers. To some extent, Tesla’s brand power will be needed to win over customers.

Tesla has a growing number of self-driving competitors, which makes it less likely it can own a large part of the market share across the industry. The primary rival is Google’s Waymo, which is on the road in both the US and Europe. It can claim a lead in terms of testing footprint.

The winners of the self-driving race will win for two reasons. One is the strength of technology. The other is regulatory approval. Depending on the geography, approval can happen at the national, state, or city level. Products are not considered “safe enough” today to operate without human supervision. Meanwhile, it is not good news for Tesla that Nvidia is winning over more car company partners.

Contact [email protected] for any questions or corrections.

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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

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Amulya Vishwanath, who spent seven years leading product marketing for NVIDIA’s robotics platforms, says robotics is currently in its “Lego era,” with the basic building blocks like actuators, robotic hands, software, and safety standards still being rebuilt. 

This view runs counter to those who believe that robotics, powered by a general foundation model, is about to have its “ChatGPT moment” — that day when the shockingly capable chatbot was launched in late 2022. (General Intuition CEO Pim de Witte told Equity earlier this year that a single general foundation model would make much of today’s specialized robotics work redundant, and be that moment.) 

On this episode of TechCrunch’s Equity podcast, Dominic-Madori Davis caught up with Vishwanath to discuss where she’s writing first checks as the founder and managing partner of Techable VC. They also talked about what she’s learned as one of the first women executives to spin out of Nvidia and launch her own early-stage firm investing in physical AI across robotics, materials science, and life sciences. 

Listen to the full episode to hear more about: 

Why Vishwanath defines physical AI as more than robots: “a molecule, a material, a medicine,” or a machine on a factory line.  What she means by “conscious automation.”   Why the best opportunities solve big problems like family-run factories that can’t find workers to surgeons facing burnout.  Why she wants founders to see their VC as their moat, and how years at NVIDIA built the network she now uses for due diligence and customer introductions.  Where she thinks the U.S. and China each have the edge, and why humanoids should be good for more than dancing.  Subscribe to Equity on YouTube, Apple Podcasts, Overcast, Spotify and all the casts. You can also follow Equity on X and Threads, at @EquityPod. 

Theresa Loconsolo is an audio producer at TechCrunch focusing on Equity, the network’s flagship podcast. Before joining TechCrunch in 2022, she was one of 2 producers at a four-station conglomerate where she wrote, recorded, voiced and edited content, and engineered live performances and interviews from guests like lovelytheband. Theresa is based in New Jersey and holds a bachelors degree in Communication from Monmouth University.

You can contact or verify outreach from Theresa by emailing [email protected].

Dominic-Madori Davis is a senior venture capital and startup reporter at TechCrunch. She is based in New York City.

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Dan Ives remains bullish on Nvidia
NVDA -0.93% 95

after the chipmaker's recent retreat, viewing the pullback as a possible entry point rather than a warning sign.

Wedbush analyst Dan Ives retained his Outperform rating and $300 price target, viewing the latest share-price weakness as a potential entry point.

Shares slipped roughly 5% over the previous two sessions as semiconductor stocks came under pressure. Investor concerns include borrowing costs and the expense of financing new AI data-center capacity.

Ives argues that spending remains supported by contracts and cash generation at major cloud providers. Nvidia's preliminary fiscal 2028 outlook points to revenue growth of about 70%, with restricted supply expected to remain a bottleneck.

The analyst's thesis also encompasses Nvidia's wider technology portfolio. Networking equipment, integrated computing systems and CUDA software work alongside its graphics processors, giving the company exposure to several parts of AI infrastructure. Ives expects investment to extend beyond training models toward reasoning applications, autonomous agents and robotics, potentially creating additional demand for computing capacity.

Check the Warning Signs for

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Fine-tuned NVIDIA Nemotron 3.5 Super VL delivered strongest overall performance based on Navan’s internal evaluation with lowest latency and significant efficiency

PALO ALTO, Calif.--(BUSINESS WIRE)--Navan (NASDAQ: NAVN), the global AI-powered business travel and expense platform, today announced that NVIDIA Nemotron 3.5 Super VL is now powering several of its AI travel agents in production. Just three weeks after receiving early access and beginning its work with NVIDIA, Navan trained and deployed the model.

The deployment is the latest example of Navan’s open-model strategy: evaluating models for specific travel tasks, adapting them with Navan’s travel expertise, and self-hosting them to maintain control over performance, cost, and reliability.

Before deployment, Navan internally evaluated Nemotron 3.5 Super VL against its self-hosted production baseline and other models using consistent prompts, tools, travel scenarios and criteria. After fine-tuning with NVIDIA NeMo AutoModel VLM LoRA training recipe, Nemotron 3.5 Super VL delivered the strongest overall performance, beating or tying every competing model on six of seven measures, including having the lowest latency. The model is now in production and powering customer conversations at a lower cost while delivering greater value to Navan users.

“Building reliable agentic travel systems involves much more than choosing a model, but continuously iterating to improve and solve real-world problems,” said Ilan Twig, co-founder and CTO of Navan. “We’re grateful to NVIDIA for early access to Nemotron 3.5 Super VL, which shows how open models can help us move faster, maintain control, and deliver meaningful value without compromising quality.”

Navan combines open and closed models to build AI travel agents that understand what travelers want, follow policies, and use the right tools to get the job done.

About Navan

Navan (NASDAQ: NAVN) is the global AI-powered business travel and expense platform that makes travel easy for travelers. From finding flights and hotels, to automating expense reconciliation, with 24/7 support along the way, Navan delivers an intuitive experience travelers love and finance teams rely on. See how Navan customers benefit and learn more at navan.com.

Forward-Looking Statements

All statements in this press release other than statements of historical fact could be deemed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are often identified by words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “will,” or similar expressions. Such statements are subject to risks, uncertainties and other factors that may cause actual results to be materially different from any future results expressed or implied by the forward-looking statements. These risks and other factors include the risks described under the caption “Risk Factors” in Navan’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (“SEC”) on September 10, 2026, as they may be updated by Navan’s subsequent filings with the SEC. Except as required by law, Navan undertakes no obligation, and does not intend, to update these forward-looking statements.

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CoreWeave stock fell again Friday despite Cathie Wood's ARK Investment Management buying shares in the under-pressure, AI stock.

Jensen Huang admits Nvidia can only fill about 70% of current demand, and Taiwan's government just backed a multibillion-dollar bet that moving suppliers to Texas soil changes that equation for both Nvidia and TSMC.

Supply is the tightest constraint on Nvidia (NASDAQ:NVDA | NVDA Price Prediction). On its August 26, 2026 earnings call, CEO Jensen Huang said, “our entire supply chain is challenged,” and Taiwan now wants to move part of that chain to Texas.

In remarks reported October 16, 2026, Taiwan’s economics minister, Kung Ming-hsin, spoke. He said the government supports a plan for U.S. industrial parks, starting in Texas, with the first complex costing up to $4 billion. The parks target smaller suppliers that serve Taiwan Semiconductor Manufacturing (NYSE:TSM) and AI server assemblers such as Foxconn, placing them near Nvidia and other data center hardware makers.

The two names dropped on October 15, 2026, during a wider tech selloff over AI funding worries. Nvidia closed at $217.23, down 1.84%, and TSMC’s U.S. shares closed at $422.25, down 1.80%.

If you own either stock, the question is whether a supplier park matters to companies this large. It matters more to TSMC’s U.S. ecosystem than to Nvidia’s earnings.

What Taiwan Has Committed The plan is a statement of intent, backed by government support. The Taiwan Electrical and Electronic Manufacturers’ Association, an industry group, is expected to raise the money, and the government will offer loan guarantees, visas, and land access.

Kung Ming-hsin put each site’s estimated cost at $2 billion to $4 billion, and the government wants more than one U.S. location but has not set a number. Nvidia, TSMC and Foxconn have made no commitment to the parks, and no participating suppliers, schedule or customer contracts were named.

What Nvidia Gains From Local Suppliers AI servers rely on smaller makers of power supplies, cooling systems, circuit boards, connectors and chassis. Placing them near U.S. assembly cuts shipping time and tariff exposure, which also helps Nvidia’s standing in Washington (we profiled seven of these non-chip AI infrastructure suppliers, from power to cooling, in a free report you can grab here).

One site is small, with $96.22 billion in quarterly revenue and $279 billion in supply commitments. U.S. production usually costs more, although forecast gross margin of about 74% suggests Nvidia has room to pass those costs to customers.

Taiwan also addressed AI hardware policy. Shipping restricted AI hardware to mainland China will become “a criminal offense under the Foreign Trade Act.” That lowers the risk of leakage, and Nvidia’s guidance already excludes Data Center compute revenue from China.

Why TSMC Sits Closer to the Buildout TSMC’s planned U.S. investment reached $265 billion after it added $100 billion for Arizona in July. A Texas supplier park is small beside that, but it puts parts makers between the Arizona fabs and the server assemblers.

TSMC is also studying Texas. Describing capacity options outside Arizona on its October 15, 2026 call, management said, “And Texas is one,” and added that teams are evaluating options, with no investment announced.

Permitting, U.S. labor costs, and whether enough suppliers sign up are all unresolved. Larger Taiwanese firms are already moving on their own. Quanta Computer won approval to spend $973 million on server assembly in Tennessee, and Wistron won approval for $146 million to upgrade a Texas plant.

Taiwan’s semiconductor exports hit a record $87.22 billion in September, up 60.9% from a year earlier, so the demand exists now. The parks assume it holds up long enough to cover higher U.S. costs.

How Texas Supplier Parks Could Shape the Outlook for Nvidia and TSMC Supply remains the main limit on Nvidia’s growth. Huang said the company has supply for about 70% of demand, so added U.S. capacity helps marginally.

TSMC has more direct exposure to the reshoring theme, because it runs the fabs a Texas cluster would serve. Its $1.95 trillion market value, against Nvidia’s $5.25 trillion, also gives local suppliers more weight in its story.

The signal to check is an announcement naming the first suppliers in a Texas park, along with a confirmed site and schedule. Until then, Kung Ming-hsin’s $4 billion figure is only an upper estimate for one site.

Contact [email protected] for any questions or corrections.

Plus, introducing the data center soft launch.

I recently reviewed Nvidia's (NVDA -1.84%) latest quarterly SEC filing, and what I read persuaded me to change my call on the stock. In the recent past, I called Nvidia a buy amid its rapid revenue growth and comparatively low valuation.

Today, as I look more closely at the numbers, I worry more about its near-term future. Amid that concern, I am now switching my call on Nvidia from buy to hold. Here's why.

Image source: The Motley Fool.

Nvidia's positive attributes First, making this shift does not mean I have turned on Nvidia. I still see it as an excellent choice for the long term. The company continues to dominate the artificial intelligence (AI) accelerator market and is investing enough into research and development to stay on top of the market and pivot into cutting-edge technologies.

Moreover, it currently trades at just 28 times earnings. Considering the S&P 500's average P/E ratio is 27, that looks like a reasonable valuation for a top company.

Furthermore, Nvidia plans to buy back $235 billion of its stock between now and January 2028. Between its future sales growth and its dwindling outstanding share count, the stock could easily outperform the market over the longer term.

NVDA Nvidia$217.23-$4.07 (-1.84%)

NASDAQ · As of 4:00 PM ET 10/15/26

The challenge with Nvidia A quarter-century ago, the internet industry endured the dot-com bust. A similar event is likely to hit the AI industry at some point. An AI bust would be unlikely to destroy Nvidia, but the company has a key vulnerability that makes its near-term direction less certain.

Buried in Nvidia's latest quarterly filing was the revelation that five companies each make up between 10% and 22% of its accounts receivable balance, for a total of 70%.

Nvidia did not reveal which specific companies they were. Still, one is likely to be OpenAI, a company that's underperforming its financial expectations. Additionally, even better-established hyperscalers like Amazon have borrowed heavily and turned free-cash-flow negative. Those factors could limit its spending over time.

For now, Nvidia's growth remains exceptionally strong. In the first half of its fiscal 2027 (a period that ended July 26), its revenue was $178 billion -- a 96% increase from the prior-year period. Analysts forecast that its growth will remain in the high-double-digit percentages through at least the next fiscal year.

Unfortunately, if one or more of Nvidia's top customers reduce or stop their purchases of its processors, its growth rate could easily slow in the near term -- or its top line could even contract. Since investors have been reluctant to bid its stock price higher despite its relatively low P/E ratio, such a slowdown could make the stock's direction uncertain for a time.

Nvidia stock is likely a hold Nvidia looks more like a hold than a buy when considering the company's high dependence on a small number of customers.

Indeed, with its leadership in AI accelerators, relatively low valuation, and efforts to reduce its share count, the chip stock appears well-positioned to benefit from growth, as the potential downside seems limited.

However, an AI bust, even if it ultimately proves temporary, could bring significant uncertainty to Nvidia stock if those five customers slow their purchases.

Hence, while Nvidia remains in a strong position over the longer term, the risk of near-term revenue growth slowing probably means investors should pause additional stock purchases for now.

Microsoft (MSFT +1.08%) is planning a big change to its Azure cloud computing data centers starting next year. It will rely much more on its custom-designed silicon than on leading graphics processing units (GPUs) like those from Nvidia (NVDA -1.84%). It's already made significant progress in expanding workloads for its Maia 200 chips, and it expects its next-generation Maia 300 chips to deliver significant improvements when it starts deploying them next year.

"Starting next calendar year, we will scale our Maia family to multi-gigawatt deployments, making it the primary inference system for our own product and services," CEO Satya Nadella said.  That's great news for its custom chip partner, Marvell Technology (MRVL -1.65%), and bad news for Nvidia.

Image source: Microsoft.

Nvidia is losing data center market share Nvidia's extreme dominance of the data center GPU space during the first few years of the artificial intelligence (AI) boom left its market share with nowhere to go but down. Its biggest customers, including the hyperscalers and leading AI frontier labs, have developed custom solutions that can handle AI workloads, and that can deliver better price performance on specific tasks than Nvidia's GPUs.

That said, GPUs offer far greater flexibility in terms of the types of tasks they can perform, making them particularly valuable for companies deploying servers to sell compute capacity to third parties with dynamic demands. Notice that Microsoft is starting its Maia expansion by focusing on its own products and services, not on leasing Maia compute capacity to third parties looking to cut costs on their OpenAI GPT-based applications.

NVDA Nvidia$217.23-$4.07 (-1.84%)

NASDAQ · As of 4:00 PM ET 10/15/26

Their use, though, could expand over the long run. Alphabet (GOOG +0.37%) (GOOGL +0.45%), which has been building its own custom AI chips for longer than any of its competitors, has seen strong adoption of its Tensor Processing Units (TPUs) by its Google Cloud customers for training and inference. Apple used TPUs to train Apple Intelligence, and Anthropic is using gigawatts worth of TPUs to develop its large language models.

While Nvidia can continue to grow sales extremely quickly, other chipmakers' growth rates are likely to outpace it. That's reflected in its P/E valuation, which now sits below those of its biggest rivals.

Microsoft could be Marvell's fastest-growing customer During its 2026 investor day this month, Marvell said it expects that it will grow its share of the custom AI accelerator market over the next five years. Its work on the Maia 300 is likely a big reason why. Microsoft's plan to make that processor the primary inference system for its products and services is in line with earlier reports that it will make a big step up in custom silicon orders starting next year.

The revenue opportunity for Marvell is huge. Microsoft will spend approximately $175 billion in capital expenditures on data centers over the next year. Roughly two-thirds of that will go toward servers and networking equipment. If Marvell takes just a sliver of that spending, it would amount to a huge boost to its revenue, which totaled just $9.5 billion over the last four quarters.

MRVL Marvell Technology$241.24-$4.04 (-1.65%)

NASDAQ · As of 4:00 PM ET 10/15/26

Marvell believes the combination of its custom AI chips and its networking chips will help it grow revenue tenfold over the next five years. That is to say, Microsoft's ramp-up in Maia chips is just the start. Marvell also signed a deal with Google earlier this year to design and sell inference-optimized versions of its TPU chips. The deal also gives Alphabet the option to take a stake in Marvell.

Considering Marvell's growth potential, the stock's forward P/E of 63 looks inexpensive. If you look out to its fiscal 2029 (which mostly takes place in calendar 2028), the stock trades at just 21 times earnings estimates. Given its potential to capture a significant slice of the market for data center AI processors, that seems like a good price to pay.

Nvidia (NVDA -1.84%) and Space Exploration Technologies (SPCX -2.33%) are two monstrous companies. Nvidia is valued at about $5.5 trillion, while SpaceX is a $2 trillion company. The world's first trillion-dollar company didn't appear until 2018, showing how far the market has come in just a short period of time.

A lot of that growth is thanks to a bullish outlook on the artificial intelligence build-out, and these two often come up as top AI options. But which is the best pick? Let's take a look.

Image source: Getty Images.

Nvidia and SpaceX are partners in AI Nvidia and SpaceX are two completely different investments in the AI field. Nvidia is more of a hardware play, while SpaceX is an application play.

Nvidia makes graphics processing units (GPUs), which are the computing muscle behind many AI workloads today. Although it has rising competitors, Nvidia's products still sit atop the AI computing unit food chain. In fact, SpaceX Chief Executive Officer Elon Musk had this to say about Nvidia's computing units during its Q2 conference call:

And going forward, we've decided to build exclusively on Nvidia because we think the Vera Rubin architecture is the best architecture. We think it's the best AI computer, and we greatly value our close cooperation and partnership on many levels with Nvidia. So, we're exclusive to Nvidia.

This is a pretty definitive statement that SpaceX will be a solely Nvidia-powered business. The architecture Musk is talking about is Nvidia's new Vera Rubin architecture, which is entering production right now. This promises a 10-fold reduction in inference costs and a fourfold reduction in training costs compared to prior-generation Blackwell GPUs. That's a huge gain and will keep Nvidia at the top.

NVDA Nvidia$217.23-$4.07 (-1.84%)

NASDAQ · As of 4:00 PM ET 10/15/26

SpaceX is a bit of a different AI play. Before going public in June, SpaceX purchased xAI, which produces the Grok AI model. The Grok model is a fairly popular large language model family, although it may not have the same status as ChatGPT or Claude. Still, it's a rapidly growing part of SpaceX's business, with xAI's revenue soaring 213% in Q2. xAI will be a profitable and successful business unit for SpaceX if it can continue expanding its reach and integrate into various applications. This token usage will drive a strong recurring revenue stream for xAI.

We're in the early innings of the AI boom, and the Grok family of models could gain a lot of market share during the next few years, or lose it. As a result, it's a bit riskier than Nvidia, which has already established itself at the top of the AI computing unit industry. However, there's much more market to capture and room to grow for xAI, so it's a question of whether you value higher growth with less certainty or slower growth with greater certainty.

SPCX Space Exploration Technologies$148.62-$3.54 (-2.33%)

NASDAQ · As of 4:00 PM ET 10/15/26

Nvidia is already growing at such a rapid pace (revenue doubled in Q2), so I'm going to give it the nod here, because anytime you can pick a stock that's doubling its revenue and has strong projections to continue that growth in the future makes for a smart pick.

But that's not Nvidia's only advantage.

Nvidia has a reasonable price tag There's no way around it: SpaceX stock is expensive. First off, SpaceX isn't profitable, so we need to use sales to value the stock. For this year, Wall Street analysts estimate it will generate about $45 billion in revenue. Nvidia's revenue is expected to be about $412 billion.

So, if these two traded at the same price, Nvidia should be valued at nearly 10 times as much as SpaceX. However, that's not the case; it's only valued at about 2.5 times as much.

As a result, I think it's pretty clear that Nvidia is far cheaper than SpaceX, making it the better AI stock to buy.

Three Vanguard fund names sound like three different strategies, but the same handful of mega-cap tech companies sit at the top of all of them, and that hidden overlap quietly shapes how much risk you are actually taking on.

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Over the past ten years, the Vanguard Information Technology ETF (NYSEARCA:VGT) returned almost 800%. The Vanguard Growth ETF (NYSEARCA:VUG) returned 429%, and the Vanguard S&P 500 ETF (NYSEARCA:VOO) returned 324%. Someone who owns all three probably thinks they are well diversified, holding a market fund, a growth fund, and a sector fund. In practice, they hold three funds with overlapping exposure. The same few mega-cap technology companies sit near the top of each, so stacking them repeats that exposure at three levels.

Every return below is a total return, including reinvested distributions and adjusted splits, over the same one-, five-, and ten-year windows.

VOO Already Hands You a Heavy Dose of Big Tech VOO tracks the S&P 500, which weights large U.S. companies according to their market capitalization. Under cap weighting, the more a company is worth, the bigger its share of the fund. The fund held 519 stocks at midyear, and information technology made up 38.0% of net assets, according to Vanguard’s semi-annual report.

That figure understates the tech exposure. Alphabet and Meta fall under communication services, which held 9.7%. Amazon and Tesla sit in consumer discretionary, at 9.3%. Late-summer holdings data ranked the four largest positions as NVIDIA (NASDAQ:NVDA | NVDA Price Prediction), Apple (NASDAQ:AAPL), Microsoft, and Amazon (per Yahoo Finance).

VOO returned 17% over one year and 86% over five, and it charges 0.03% a year. It is broad, but its biggest holdings are the names the other two funds lean on.

VUG Screens the Same Pool and Keeps the Fastest Growers VUG tracks the Morningstar US Large Cap Growth Index. That index starts with large U.S. companies, the same universe the S&P 500 draws from, and keeps the ones with the strongest growth characteristics. Slower growers such as banks, energy producers, and consumer staples companies get filtered out, so the mega-caps that remain carry more weight.

The fact sheet from Vanguard put 65.9% of the fund in technology, a sector profile that differs from VOO’s, plus 16.2% in consumer discretionary. The fund charges 0.03%.

VUG returned 13% over one year and 85% over five. It trailed VOO in both windows and led it over ten years. So the growth screen magnified whatever its biggest holdings did, in both directions.

VGT Puts Everything on One Sector VGT tracks the MSCI US IMI/Information Technology 25/50 index. “IMI” means it includes into mid- and small-cap stocks, but only within technology. The 25/50 rule keeps any single company under 25% of the fund and holds positions above 5% to 50% combined. That cap trims the giants without knocking them off the top.

Vanguard gives VGT a rank of 5, the top of its risk scale, and points to sector concentration as the reason. VUG rates a 4. VGT charges 0.09%.

It returned 31% over one year and 143% over five.

Its decade result came from a concentrated run in a small number of very large companies. Treat it as history.

A Wide Return Spread Comes From One Driver An 800% decade next to 324% looks like proof that these funds act differently. The gap reflects one factor — mega-cap tech — held at three different concentration levels. When that factor rallies, the fund holding the most of it gains the most. VUG’s rank moves around because its screen also loads up on consumer names like Amazon and Tesla, but all three funds move in the same direction.

The past week showed how this works on the way down. VOO’s price fell 1.4%, VUG fell 3%, and VGT fell 5%. All three dropped together, and the most concentrated fund dropped the most. In a year when tech turns against them, expect that same pattern on a bigger scale.

When Holding Two of These Makes Sense Wanting a growth or technology tilt is a real choice, and a defensible one. Investors who believe mega-cap tech deserves extra weight can pair VOO with a set amount of VGT and know exactly what they own.

The trouble starts when that tilt happens by accident because three fund names sound like three strategies. Decide first how much of your portfolio should ride on a few tech giants. Then size each fund to hit that number.

Add Up Your Real Exposure Across Every Fund Pull each fund’s top ten holdings. Vanguard publishes them on every fund’s profile page and fact sheet, so you can check current weights instead of relying on memory. Convert fund weights into portfolio weights. Multiply each company’s weight in a fund by that fund’s share of your account. This shows what NVIDIA or Apple actually represents in your money. Combine the same company across funds. Add up each name’s exposure from every fund that holds it, including any individual shares you own. Test your top five against a shared decline. Compare the combined weight of your five largest companies with what you could tolerate if all of them fell in the same quarter. Portfolio analysis tools at most large brokerages will do this overlap math automatically.

Three Tickers Running on One Engine VOO, VUG, and VGT draw on the same handful of companies, so owning all three amplifies a single exposure. That can be the right call if you size it on purpose. Before you add a fourth fund, look at the combined weight of your largest holdings. That number tells you how diversified you actually are.

Contact [email protected] for any questions or corrections.

The "Magnificent Seven" group of stocks describes some of the leading tech stocks in the market. While some of these stocks aren't as dominant as they were a few years ago, when this grouping was first formed, they still comprise the largest stocks listed on the U.S. stock market. It's made up of:

Nvidia (NVDA -1.84%)
Apple (AAPL -0.28%)
Alphabet (GOOG +0.37%) (GOOGL +0.45%)
Microsoft (MSFT +1.08%)
Amazon (AMZN +0.27%)
Meta Platforms (META -0.11%)
Tesla (TSLA -1.29%)

I currently own every stock on this list, but there are three that I'm keen to buy more of: Nvidia, Alphabet, and Amazon. Why? These three have a lot to gain from the artificial intelligence build-out.

Image source: Getty Images.

Amazon and Alphabet's cloud computing businesses are booming
Amazon and Alphabet are two of the major providers of cloud computing services. Amazon Web Services (AWS) and Google Cloud are typically ranked as the largest and third-largest in their industry, and each is spending heavily to maintain that status. In 2026, Amazon's data center capital expenditures are expected to be $220 billion, while Alphabet's are expected to be about $200 billion. If these two are spending that much, why are their stocks a buy?

AMZN Amazon$254.76+$0.68 (+0.27%)

NASDAQ · As of 4:00 PM ET 10/15/26

It all has to do with the return on investment these two are generating, and I think it will be quite high.

Starting with Alphabet, Google Cloud is growing at an unbelievable pace. In Q2, Google Cloud's revenue rose 82% year over year, and it posted an impressive 36% operating margin. That growth was a major boost to the company overall, and with over $500 billion in backlog to churn through, Alphabet needs the computing power. While it's spending heavily right now, it will eventually generate a much larger profit.

GOOGL Alphabet$349.22+$1.58 (+0.45%)

NASDAQ · As of 4:00 PM ET 10/15/26

Amazon is in the same boat, as AWS grew at 37% in Q2 -- much faster than its commerce division. However, AWS has a far higher profit margin. So, despite generating about 21% of revenue in Q2, it accounted for 60% of operating profits. This means that as AWS's growth rate accelerates due to new computing capacity coming online, its profits will grow even faster. That bodes well for the stock, making Amazon a great Magnificent Seven investment.

But what about Nvidia?

Nvidia is the major computing power dealer
While Amazon and Alphabet have custom AI computing chips they're using in their data centers, the bulk of their computing power still comes from GPUs made by Nvidia. GPUs are synonymous with AI computing power, and nearly every client of Alphabet and Amazon is familiar with and uses Nvidia GPUs. So, the cloud computing providers must keep buying Nvidia chips to satisfy client demand.

NVDA Nvidia$217.23-$4.07 (-1.84%)

NASDAQ · As of 4:00 PM ET 10/15/26

Alphabet and Amazon's big spending in 2026 is providing Nvidia a major boost. However, the build-out is far from over. Nvidia informed investors last quarter that the big five AI hyperscalers will spend nearly $800 billion on data centers this year. Next year, that figure rises to $1.3 trillion. That's a huge boost and will provide Nvidia with major growth. Nvidia didn't shy away from offering an estimated 2027 growth rate, projecting an impressive 70% increase in revenue.

That's far higher than any other company in the Magnificent Seven, continuing Nvidia's outperformance trend.

NVDA Revenue (Quarterly YOY Growth) data by YCharts

Nvidia may be the biggest, but it's still the best. And I think it's still the top stock to buy in the Magnificent Seven, although Amazon and Alphabet are great picks too.

Keithen Drury has positions in Alphabet, Amazon, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool has a disclosure policy.

Volvo Cars (VOLCARb.ST) is expanding its partnership with Nvidia (NVDA.O) to develop a new generation of driver-assistance and automated-driving technology, the ​companies said on Thursday, as carmakers race to ‌bring increasingly advanced hands-free driving features to market.

The companies said Volvo would combine its safety systems and engineering expertise with Nvidia's artificial intelligence and ​computing technologies, including the Hyperion sensor, computer architecture and ​autonomous-driving software stack.

Alwin Bakkenes, Volvo Cars' head of software ⁠engineering, told Reuters the first deployment would focus on supervised ​driving features, with drivers remaining responsible for the vehicle.

Bakkenes said ​Volvo's ambition was to gradually introduce more advanced capabilities, including hands-free driving in urban areas and on highways.

The move comes as automakers including Mercedes-Benz, ​BMW and Ford target more advanced automated-driving systems, from hands-free ​highway driving to self-driving operations in limited conditions.

Tesla is pushing for broader approval of ‌its ⁠assisted-driving technology in Europe, including urban areas with an EU-wide vote possible in December.

The technology should appear in Volvo vehicles before 2030 and will be launched in multiple regions simultaneously, excluding China, ​Bakkenes said.

Volvo, which ​is majority ⁠owned by China's Geely Holding (GEELY.UL), has not chosen a pricing model yet, Bakkenes said, but features ​would not just be available for higher-priced models.

Besides ​Volvo, Nvidia ⁠has partnerships with a wide range of automakers, including Mercedes, Jaguar Land Rover and Hyundai.

"The most important functionality of autonomous driving assist ⁠technology ​is safety," Nvidia automotive chief Ali ​Kani told Reuters. "We believe that we're going to make the stack safer getting ​to work with Volvo."

There are doubts in the AI buildout as CoreWeave's (CRWV) debt financing is questioned, though Rolf Bulk of Futurum says the neocloud's backlog supports the spending even if future deals face some constraint. He adds that CoreWeave and other neoclouds "will not collapse by any means" due to the GPUs they have offering sources of tangible income.

Key Takeaways Micron's fiscal 2026 revenues reached $133.19 billion, up from $37.38 billion in fiscal 2025.NVIDIA's Data Center revenues surged 117% to $89 billion, with fiscal Q3 revenue projected at $108 billion. Micron's 5.18 forward P/E and 3.3% debt-to-equity ratio compare with NVIDIA's 23.93 and 14.1%.
Semiconductor behemoths Micron Technology (MU - Free Report) and NVIDIA Corporation (NVDA - Free Report) benefited from the artificial intelligence (AI) boom. With strong growth and an upbeat outlook, both seem poised to capitalize on rising AI infrastructure demand. But which stock offers a better buying opportunity? Let’s explore –   

Micron’s AI Growth and Expanding Margins Boost Outlook As AI infrastructure needs high-performance memory, demand for Micron’s cutting-edge high-bandwidth memory (“HBM”) chips has surged. This momentum helped the company post revenues of $54.23 billion in the fiscal fourth quarter of 2026, up sharply from $11.32 billion a year ago, according to its Sept. 30 press release. 

For fiscal 2026, Micron’s revenues were $133.19 billion, up from $37.38 billion in fiscal 2025. Its guidance remains even more encouraging, with the company expecting revenues of $61.5 billion, plus or minus $1.5 billion, in the first quarter of fiscal 2027. The data center business continues to be Micron’s key growth engine, benefiting from an increase in AI-related demand. 

Additionally, Micron’s profit margins are reaching exceptional levels. Its non-GAAP gross margin increased from 84.9% in the fiscal third quarter of 2026 to 87% in the fiscal fourth quarter, supported by higher selling prices, a favorable product mix, and operating leverage. Further, the company’s management expects its Strategic Customer Agreements to improve earnings visibility. 

NVIDIA’s AI Demand Fuels Revenue Growth and Strong Profitability According to NVIDIA’s Aug. 26 press release, the company’s revenues climbed 106% year over year and 18% sequentially to $96 billion in the fiscal second quarter of 2027. Its Data Center segment remained the primary growth driver, with revenues surging 117% year over year to $89 billion.  

Going forward, NVIDIA expects revenues of $108 billion, plus or minus 2%, in the fiscal third quarter of 2027, signaling further sequential growth. The company also expects profitability to remain strong as its Vera Rubin platform has entered the full production stage, while NVIDIA remains well-positioned to capitalize on the next wave of AI infrastructure demand. 

By the way, NVIDIA’s gross margin rose to 75% in the fiscal second quarter of 2027 from 72.4% a year earlier, while both GAAP and non-GAAP net income increased. NVIDIA’s GAAP operating income more than doubled year over year, implying strong operating leverage. 

Micron or NVIDIA: Which AI Stock to Buy After Earnings Both Micron and NVIDIA’s recent strong revenue growth, expanding margins, and upbeat guidance could boost both stocks. However, U.S. chip export restrictions to China and stiff competition could limit NVIDIA’s further growth, while Micron’s evolution from a highly cyclical memory stock to a vital supplier of AI infrastructure could drive sustained growth. 

Moreover, NVIDIA’s debt-to-equity ratio of 14.1% exceeds Micron’s 3.3%, indicating greater financial leverage and potentially greater downside risk during economic downturns.

 

Image Source: Zacks Investment Research

Therefore, Micron’s evolving role in AI infrastructure and lower financial leverage make it a more compelling buy than NVIDIA. Additionally, Micron appears more attractively valued than NVIDIA. Per the price/earnings ratio, MU trades at 5.18 forward earnings compared with NVDA’s forward earnings multiple of 23.93.

 

Image Source: Zacks Investment Research

Micron currently has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

Germany plans a wide-ranging cooperation agreement with US chip maker Nvidia (NVDA.O) to ​boost the take-up of artificial intelligence ‌in German industry, business daily Handelsblatt said on Thursday, citing people familiar with the issue.

It said the ​deal would be announced next week ​at the Invest in Germany conference in ⁠Berlin, where Nvidia Chief Executive Jensen ​Huang will be a guest.

The aim of the ​deal would be two-fold, the newspaper said. Firstly, it would create the basis for physical AI tools, ​used in training robots or self-driving vehicles. ​Secondly, it would help to create high-performance AI models ‌for ⁠industry.

The newspaper said the agreement would involve investments in the hundreds of millions of euros.

It said the agreement would be formed ​around the SOOFI ​project - ⁠Sovereign Open Source Foundation Models - launched in Germany last year to ​develop large AI models in collaboration ​with ⁠research institutions, universities, and AI companies.

No comment was immediately available from the German government, which ⁠said ​last month it remained committed ​to further development of AI capacity to strengthen Europe's digital ​sovereignty.