NVIDIA Corp. (NASDAQ:NVDA) stock fell more than 1% in Tuesday’s premarket trading as investors pulled back from large-cap technology stocks. Nasdaq futures dropped 1.02%, while S&P 500 futures fell 0.59%.
The broader market weakness came as analysts assessed NVIDIA’s growing push into the custom artificial intelligence chip market. That strategy could open a new growth channel for NVIDIA while increasing competitive pressure on Broadcom.
NVIDIA’s NVHBM Push Threatens Broadcom’s AI Chip Position, Analyst SaysNVIDIA is expanding deeper into the custom artificial intelligence chip market with NVHBM, according to Counterpoint Research analyst Neil Shah.
The technology could challenge Broadcom Inc. (NASDAQ:AVGO) while strengthening NVIDIA’s influence over AI infrastructure.
NVHBM moves the memory controller from the accelerator chip into the base die of a high-bandwidth memory stack. It also replaces the standard JEDEC memory bus with NVIDIA’s proprietary die-to-die connection.
Shah said the approach gives NVIDIA control over the memory controller, interface and link protocol. Memory suppliers would manufacture the base die based on NVIDIA’s design.
NVIDIA Expands Beyond GPUsThe strategy could allow NVIDIA to sell its networking fabric, rack architecture, software and memory subsystem to companies developing custom accelerators. NVIDIA would not need to design the accelerator itself.
Amazon.com Inc.’s (NASDAQ:AMZN) Annapurna Labs is the first disclosed customer. It plans to use NVHBM with its Trainium4 AI chip.
MediaTek also adopted NVIDIA’s NVLink Fusion platform. Shah said this gives NVIDIA another channel for reaching custom chip customers.
However, the analyst questioned some of NVIDIA’s performance claims. The company compared NVHBM with HBM4E, which is not yet shipping, and did not disclose its full testing baseline. Shah said only the claimed 67% reduction in physical interface area can be checked using available pin-count data.
Broadcom Faces New CompetitionShah said NVHBM places NVIDIA directly in a market served by Broadcom and Marvell Technology Inc. (NASDAQ:MRVL).
Broadcom could benefit from wider adoption of custom AI chips. Still, it lacks a comparable base-die offering, according to the analyst.
Marvell outlined a similar architecture in December 2024 and has joined NVLink Fusion. That leaves Broadcom as the only major custom chip design company without a direct NVIDIA partnership, Shah said.
NVIDIA Technical Analysis And Analyst OutlookNVIDIA remains in a longer-term uptrend despite the early decline. The stock trades 4.5% above its 50-day simple moving average of $208.62. It is also 11.3% above its 200-day SMA of $195.96.
However, NVIDIA trades about 0.3% below its 20-day SMA of $218.75. That level could influence the stock’s near-term direction.
The relative strength index stands at 54.25. This neutral reading suggests the stock is consolidating. It is neither overbought nor oversold.
The moving-average structure remains bullish. The 20-day SMA sits above the 50-day average. Meanwhile, the 50-day SMA remains above the 200-day average.
Key resistance stands near $228. A stronger rally could put the 52-week high of $236.54 back in focus. Support sits near the 200-day SMA, followed by the $190 level.
The stock trades at 27.9 times earnings. That valuation reflects high expectations for continued growth. NVIDIA carries a consensus Buy rating and an average price forecast of $349.15.
Citigroup and Mizuho raised their price forecasts to $315 on Aug. 27. JPMorgan increased its forecast to $320. Citigroup maintained a Buy rating, Mizuho kept an Outperform rating and JPMorgan maintained an Overweight rating.
NVDA Price ActionNVIDIA shares fell 1.35% to $217.80 in Tuesday’s premarket session, according to Benzinga Pro.
AMD (AMD +1.10%) and Nvidia (NVDA +1.49%) are recognized as two of the top computing unit manufacturers in the AI arms race. While Nvidia got off to a hot start and dominated the initial build-out, AMD has made up some ground recently, although Nvidia still holds a far lead.
Unless you're familiar with the computing industry, determining which company has the best technology may not be easy. To determine which products are best, sometimes finding a smart voice in the industry is the best approach.
One of the most highly regarded minds in the world is Elon Musk, CEO of both Tesla and Space Exploration Technologies. Both companies are spending heavily on computing infrastructure: Tesla is training its self-driving vehicles on countless hours of recorded driving footage, and SpaceX owns xAI, the maker of the Grok large language model.
Musk knows a thing or two about which computing units he prefers his companies to use, and he just gave a glowing endorsement to one of these two firms.
SpaceX and Tesla CEO Elon Musk. Image source: The White House.
Musk prefers his companies to use Nvidia products During SpaceX's Q2 conference call, Musk stated:
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.
That's a pretty definitive quote, but what may be lost in that announcement is how impressive Nvidia's next-generation hardware will be. Currently, all the AI breakthroughs and advancements we've seen are on the Hopper or Blackwell architectures. Compared to Blackwell architecture, Rubin provides a tenfold reduction in inference token cost and a fourfold decrease in the number of GPUs required to train an AI model. Rubin GPUs will be more efficient, so AI firms could accomplish the same amount of work with fewer GPUs. But what will most likely happen is that firms will deploy the same number of GPUs to increase computing capacity and lower the cost per unit of work.
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That's a huge improvement, and with Rubin chips now in full production and shipping in the near future, Nvidia could see another revenue boost. However, it doesn't necessarily need to be a better stock pick than AMD.
Nvidia is growing faster than AMD Both companies have recently reported results, so a somewhat apples-to-apples comparison is possible (although AMD's report were about a month before Nvidia). AMD's total revenue rose 50%, while data center revenue increased an impressive 107%. Nvidia outperformed AMD by every measure, as its total revenue rose by 106%, while data center revenue rose 117%.
That pretty definitely scores the growth comparison in favor of Nvidia, but it also has another unique quirk: It's far cheaper than AMD.
NVDA PE Ratio (Forward) data by YCharts
AMD trades at nearly three times the price tag that Nvidia does, which is a huge premium to pay, especially considering that Nvidia's technology is recognized better by one AI CEO and is growing far faster. Even if you value the stocks using 2027 earnings estimates, Nvidia is far cheaper.
NVDA PE Ratio (Forward 1y) data by YCharts
It's rare when investors can buy a company that's doing better on nearly every measure than its competitor at a far cheaper stock price, but that's exactly what the market is handing investors right now. As a result, I think investors should swap AMD shares for Nvidia, if they have any. Or if you're on the fence about which one to buy, I think the answer is pretty clear, pretty definitive, and obvious: Nvidia.
Developments in artificial intelligence (AI) in early 2023 marked a turning point for chipmaker Nvidia (NVDA +1.49%). The company's graphics processing units (GPUs), already the top choice for serious gamers everywhere, quickly dominated the data center space, providing the sheer number-crunching capability demanded by AI processing.
Since then, Nvidia's financial results have been on a blistering run, with a 1,490% increase in revenue and a 4,120% jump in net income. These blistering financial results have driven the stock up 1,410%, providing a windfall for shareholders along the way. Investors had begun to wonder if the results were sustainable, as Nvidia's market cap has swelled to $5.33 trillion, making it the world's largest public company (as I write this).
However, Nvidia says it has "greater visibility" heading into next year, and the repercussions for its results between now and then are staggering.
Image source: Nvidia.
The data center boomTo be clear, Nvidia's GPUs were the linchpin of the company's success, but it's the Compute Unified Device Architecture (CUDA) that gives Nvidia its seemingly insurmountable moat. This library of algorithms and software tools ensures that developers achieve the best performance from Nvidia's processors. With more than 400 pre-built libraries and thousands of specialized tools, GPUs can be adapted for a variety of complex tasks. When coupled with the company's industry-leading GPUs, the combination is hard to beat.
Nvidia has been crowned king of the data center space, where the vast majority of AI processing occurs. This has fueled the ongoing data center build-out, which is expected to drive $7 trillion in spending by 2030, according to global management consulting firm McKinsey & Company. Nvidia dominates the AI accelerator market, with an estimated 80% to 90% share, according to Silicon Analysts.
When Nvidia reported its Q2 results earlier this month, CEO Jensen Huang broke with a long-standing tradition, giving the company's first-ever full-year forecast -- and the numbers were staggering. Nvidia expects revenue to grow by 70% in 2028, sailing past Wall Street's consensus of 44% growth. The company noted that if not for the limited availability of memory chips, growth would be closer to 100%.
Running the numbersUsing Huang's forecast as a starting point, we can run the numbers to estimate Nvidia's stock price by the end of next year.
At its current rate of growth, Nvidia is on track to surpass Wall Street's consensus estimate for fiscal 2027 (which ends in late January 2027) of $411 billion. Assuming the company meets its 70% revenue growth target for next year, revenue would be roughly $700 billion in fiscal 2028. Assuming Nvidia can maintain its trailing-12-month profit margin of 64%, the company would generate profits of $447 billion, or earnings per share (EPS) of $18.55.
To be fair, rising memory costs are expected to weigh on margins in the short term, but Nvidia plans to mitigate those pressures with about a 15% price increase in early 2027.
Nvidia currently has a price-to-earnings (P/E) ratio of roughly 28. If its P/E ratio remains constant and the company were to generate the profits estimated above, Nvidia's stock price is poised to rise 135% to $519 by the end of 2028. For context, that would push its market cap to $12.5 trillion.
If you think that prediction is too bullish, consider this: Gene Muster, Wall Street icon and managing partner of Deepwater Asset Management, believes Nvidia will grow revenue by 90% next year -- so the company's 70% growth estimate might well be conservative.
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The fine printTo be clear, this is all fun with numbers, but it does highlight Nvidia's ramping revenue and profit potential. Of course, any changes to the underlying assumptions could drastically change the outcome. To its credit, Nvidia has consistently beaten both Wall Street's and its own guidance, so these numbers could well be conservative.
On the other hand, competitors and customers alike are working feverishly to create a viable alternative to Nvidia's humble GPU, though it remains the top choice for reliable, fast AI processing. So even if Nvidia stock doesn't double by the end of next year, there's an undeniable trajectory for growth ahead.
Moreover, at just 24 times forward earnings and 14 times next year's expected earnings, Nvidia stock is attractively priced. The accelerating adoption of AI continues, and the company's remarkable track record makes it clear that Nvidia is an opportunity investors shouldn't sleep on.
Convertible debt connects Nvidia with custom data-center silicon, AI computers and vehicle systems without requiring a full acquisition. Summary
The investment equals approximately 3.6% of Nvidia’s latest quarterly revenue.
Nvidia NVDA, the artificial-intelligence chip powerhouse, invested $3.5 billion in MediaTek convertible bonds Monday. That equals roughly 3.6% of Nvidia's latest quarterly sales—a serious commitment, but one the company can comfortably absorb. Nvidia shares slipped about 0.3% to approximately $216.80.
The bonds are only the opening move. Under the expanded partnership, MediaTek will use NVLink Fusion to connect customers' custom processors with Nvidia's rack-scale systems. The companies are also pushing deeper into RTX Spark and DGX Spark chips while building additional automotive-computing platforms.
Nvidia has plenty of firepower after generating $96.2 billion in second-quarter revenue. Its 95/100 GF Score tells the same story: profitability, growth and financial strength are firing, while GF Value remains the weak link. The investor takeaway is sharp—Nvidia is financing the spread of NVLink across custom silicon, personal AI computers and vehicles, tightening its grip on the computing ecosystem it helped create.
Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.
MediaTek adopts NVLink Fusion, routing customer-designed accelerators back into Nvidia rack-scale systems Summary
Nvidia put $3.5 billion into MediaTek convertible bonds as the Taiwanese designer adopts NVLink Fusion for custom XPU work.
Nvidia NVDA invested $3.5 billion in convertible bonds issued by MediaTek, part of an expanded partnership covering AI infrastructure, PC chips and automotive silicon. MediaTek is a Taiwanese fabless designer known for smartphone and connectivity system-on-chips. Nvidia shares rose 0.27% intraday.
The substance is NVLink Fusion. MediaTek will offer the platform to customers designing their own AI accelerators, bundling Nvidia's Fusion chiplet, NVLink-C2C connectivity to Nvidia Rosa CPUs, and NVHBM memory into a prevalidated design foundation. Rick Tsai, MediaTek's vice chairman and CEO, said the investment "strengthens a collaboration that spans cloud AI infrastructure, local AI computing." The companies also extended existing work on RTX Spark and DGX Spark PC chips, which followed the GB10 Grace Blackwell Superchip, and on Dimensity Auto cockpit platforms.
Customers bring their own XPU designs to MediaTek and still take Nvidia's connectivity, memory architecture, packaging and rack technologies. Nvidia ran the same structure with Marvell, investing $2 billion when it joined the NVLink Fusion ecosystem.
Disclosures I am/we currently own positions in the stocks mentioned, and have NO plans to sell some or all of the positions in the stocks mentioned over the next 72 hours.
The MediaTek investment expands Nvidia's reach across cloud AI, custom silicon, edge computing and automotive systems. Summary
Nvidia invested $3.5 billion in MediaTek convertible bondsMediaTek will adopt Nvidia’s NVLink Fusion platform
MediaTek is investing $3.5 billion in convertible bonds issued by Nvidia Corp. (NVDA, Financials), the chipmaker at the heart of the artificial intelligence boom, as the two companies deepen their AI relationship. This partnership will focus on cloud infrastructure, edge computing and automotive technologies.
The arrangement includes MediaTek's adoption of Nvidia's NVLink Fusion technology, designed to let hyperscalers, cloud providers and frontier AI developers construct custom processors that can be connected into Nvidia-powered rack-scale systems.
That makes the investment strategically essential for Nvdia. But rather of only selling its own GPUs, the business is trying to make its larger computing architecture a standard that other chipmakers can build around.
That might extend the footprint of NVLink into more proprietary AI hardware for Nvidia, while keeping those systems linked to its software and networking environment.
The $3.5 billion investment also strengthens a connection that already covers cloud AI infrastructure, local computing and automotive applications.
Investors will now watch how fast bespoke processors based on MediaTek will start appearing in artificial intelligence systems connected to Nvidia, and if NVLink Fusion will become a larger industry standard.
Disclosures I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours.
Nvidia (NVDA +1.49%) reported sales that were billions more than forecasted.
*Stock prices used were the afternoon prices of Aug. 29, 2026. The video was published on Aug. 31, 2026.
Parkev Tatevosian, CFA has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
I would expect September to be a choppy month for stocks," says Jason Bodner, who talks about the macro set-up and fund flows into commodities suggesting a tone of market rotation for the new month. That said, he says, "the AI trade is alive and well" as highlighted by Nvidia (NVDA) earnings.
It is a CEO's job to put the company they run in the best light possible in every circumstance. So it shouldn't be surprising that Jensen Huang, the CEO of Nvidia (NVDA +1.49%), told investors to buy Nvidia stock amid a broader pullback in artificial intelligence (AI) stocks. That said, since his call, Nvidia is up just about 4%, as of this writing. That's not great compared to this alternative AI investment approach. Should you worry?
Nvidia is lagging... after three months Huang made his "buy" call roughly three months ago. Since that point, his company's stock has been up 4%. An investment in the S&P 500 index (^GSPC -0.33%) would have returned about the same amount. So, it is hard to suggest it was a bad call. However, if you had put equal amounts into Nvidia, Microsoft (MSFT -1.22%), Amazon (AMZN -2.50%), and Alphabet (GOOG -2.18%), creating a diversified artificial intelligence basket, you'd have benefited from an 8% gain. So it is hard to suggest Huang's call was a winner, either.
Image source: Nvidia Corporation.
Notably, almost all of the diversified AI basket's gains were attributable to Microsoft, which rose a huge 24% over the period. Alphabet actually fell 5%, while Amazon was up 8%. The real takeaway here? Three months is just too short a period to decide whether an investment is good or bad if you are a long-term investor.
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Which brings up Jensen Huang's "buy" recommendation. While he was reacting to market movements in some respects, his logic was clearly grounded in his belief that AI is a long-term growth engine for both his company and the world. In fact, the company's financial results in the fiscal second quarter of 2027 show that demand for AI chips remains very strong. Revenues rose 18% sequentially from the first quarter and an impressive 106% year over year.
Is Nvidia still trading at a discount? While it seems unlikely that this level of growth can continue forever, it is very clear that Huang's optimism about the future is founded in the success his company is seeing as global AI investment continues to grow. If you think long-term, that suggests the CEO could still be right about buying at a discount. In fact, the stock's 17.5x price-to-earnings ratio is not only below its 23x five-year average, but it is also far below the S&P 500 index's 25x P/E ratio. For tech investors looking to buy and hold an AI stock for the long term, Huang's advice could still be worth heeding, even if it wasn't a clear winner over the short term.
Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.
Anthropic has signed a cloud-computing deal worth $35 billion with Lambda, a cloud provider backed by Nvidia (NVDA.O), a source familiar with the matter said on Monday.
The deal will bring online Nvidia capacity to meet growing demand for Anthropic's Claude AI, the source said.
The news was first reported by the Wall Street Journal.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in NVDA over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock, you should do your own research and reach your own conclusion or consult a financial advisor. Investing includes risks, including loss of principal.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Nvidia announced a program to collect revenue on the same chip twice, once at sale and again through ongoing cloud profits, then paused it weeks later after internal warnings about antitrust exposure. The retreat raises a question the market has…
NVIDIA’s (NASDAQ:NVDA | NVDA Price Prediction) $96.22 billion quarter and 105.85% revenue growth would normally end the conversation. Instead, management disclosed a plan to earn a second time on every chip sold to smaller cloud providers. Days later, parts of the initiative had been paused less than two months after its announcement, with some employees warning internally about potential antitrust scrutiny.
NVIDIA still runs the most profitable franchise in semiconductors, but the speed of the retreat is the story worth examining.
How the Same Chip Was Supposed to Pay Twice The mechanism is unusual. NVIDIA would guarantee or rent unused capacity from a smaller cloud provider, which gave lenders the certainty needed to finance the hardware purchase.
CFO Colette Kress described it directly on the call: “NVIDIA provides a take or pay commitment on a portion of the facility’s capacity, a minimum revenue guarantee that gives lenders the confidence to underwrite the project, and in exchange, we share in a portion of the Neocloud’s revenue earned above that floor.”
Above the guaranteed floor, NVIDIA would collect 50% of cloud revenue. Management summarized the economics without euphemism: “In this model, we get paid twice, once on the hardware sale and again through the share of rental revenue.”
A capital-starved cloud provider gets financeable, NVIDIA books the sale, and then rides the utilization curve on hardware it already sold. The structure effectively converts a one-time transaction into a recurring revenue stream tied to compute usage, without requiring NVIDIA to operate the infrastructure itself.
Why the Math Was Too Good to Ignore NVIDIA does not need this program to justify its $5.25 trillion market cap. Data Center revenue was $89.023 billion last quarter, up 117%.
But the second revenue stream would layer recurring economics onto a transactional business. Management said it could “drive billions in revenue over the medium to long term.”
It also unlocks a customer tier that hyperscalers cannot serve. Jensen Huang argued the non-hyperscaler market is “half of the picture” and largely invisible to investors.
NVIDIA’s $108.5 billion in guarantee obligations and a partnership with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR to mobilize over $500 billion in third-party capital show the scale of ambition. Kress said balance-sheet-supported labs would account for “roughly a quarter of our business next year.”
Where the Antitrust Problem Starts The problem is control. If NVIDIA decides which providers get guaranteed capacity, it also decides which providers can borrow, build, and compete.
Management preempted the criticism: “We recognize the scale of this support, and we know some will call this circular financing. We see it differently.”
Seeing it differently is not the same as regulators seeing it differently. Internal warnings about antitrust exposure preceded any external agency review, which is telling.
Huang leaned on fungibility as the risk answer: “The NVIDIA Compute platform is fungible and durable and can be redeployed to support other customers.”
That defends NVIDIA’s downside but does not defend against the argument that the company is picking winners in the downstream compute market it already dominates on the supply side. Regulators tend to focus on gatekeeping power rather than on whether the gatekeeper can find alternative buyers, and that distinction is where the program becomes vulnerable.
What the Pause Actually Signals Pausing a program within weeks of announcing it is the kind of decision a legal team forces on a strategy team. The initiative is not dead. It could be redesigned, narrowed, or folded into the broader third-party capital platform.
Shares closed at $217.55, up 14.49% over the past month. Analysts have an average target of $305.79, with 48 buy ratings and 2 holds.
The market is not pricing regulatory risk here, which is itself a position worth questioning at 26x forward earnings. Riding an AI rally is fine as long as you have thought through the exit, and we made the case for both halves in a free bubble survivor’s handbook.
NVIDIA found a genuinely clever way to unlock demand that would not otherwise exist, but the design pushed control one step further than a dominant supplier can comfortably go. Watch whether the revenue-share language returns in narrower form, or whether the $500 billion third-party capital vehicle quietly absorbs what the direct guarantees were meant to do.
Contact [email protected] for any questions or corrections.
Saying Nvidia (NVDA) beat earnings last week "is a very serious understatement," says Ted Thatcher, who remains confident that the Mag 7 giant continues to serve as the tentpole to the AI trade. That said, "kinetic" macro headwinds in the U.S.-Iran war is something Ted sees as a lasting headwind, though he has contradictory views on interest rates and the U.S. consumer.
Despite sky-high expectations, Nvidia (NVDA +1.49%) delivered yet another blowout quarter that featured $96.2 billion in revenue -- up 106% year over year and 18% quarter over quarter, along with a 75% gross margin. The gross margin was especially impressive, considering surging prices for memory chips -- which Nvidia buys and integrates into its rack-scale Vera Rubin platform. However, Nvidia does expect gross margin to tick down to 74% in the upcoming third quarter of fiscal 2027, with revenue at $108 billion, up 12.3% quarter over quarter.
Still, the results were impeccable, and so was Nvidia's guidance for a 70% increase in fiscal 2028 revenue compared with fiscal 2027, driven by surging demand from hyperscalers, artificial intelligence (AI) labs, AI natives, enterprises, and sovereign customers. The guidance reinforces the need for rapidly expanding AI infrastructure and follows up on Nvidia's recently announced partnerships with financial institutions for $500 billion in AI capital investment to build Nvidia's computing and full-stack AI infrastructure. The computing will be sold to AI labs, AI start-ups, AI clouds, and other enterprises that need computing power.
There was a lot to like about Nvidia's report and earnings call. But there's one metric that stood out above the rest. Here's my biggest takeaway from Nvidia's Q2 earnings, and why it cements Nvidia as one of the best growth stocks to buy now.
Image source: Getty Images.
Vera Rubin extends far beyond GPUs In May, Nvidia announced that its Vera Rubin platform had ramped up into full production, with shipments beginning this fall, aligning with Nvidia's upcoming Q3 fiscal 2027. On the Aug. 26 Q2 fiscal 2027 earnings call, Nvidia confirmed that shipments began in August and expects Vera Rubin to account for 20% of its data center revenue in Q3. For context, data center revenue was 92.5% of Nvidia's total Q2 revenue.
The speed at which Vera Rubin will affect Nvidia's top line was the best part of Nvidia's latest print -- more important than its quarterly results or next quarter's guidance. Rubin represents the fastest product ramp-up in Nvidia's history. And the fact that it's already contributing so much to Nvidia's results shows that demand continues to far outpace Nvidia's supply. So with Rubin sales pouring in for the back half of fiscal 2027 and fiscal 2028, it's unsurprising that Nvidia's guidance came in well ahead of expectations.
While Rubin will undoubtedly have a major impact on Nvidia's near-term results, there's an even bigger takeaway for long-term investors: Nvidia's customers are willing to pay a premium for Rubin, meaning its benefits clearly outweigh the high price tag.
Unlike earlier architectures, Rubin comprises more than just graphics processing units (GPUs). It includes a rack-scale offering for data centers that includes six Nvidia chips -- GPUs, central processing units (CPUs), and interconnects. Rubin is tailor-made for large-scale, cost-effective AI training and inference needed from AI factories. And because Rubin is essentially bundled as a rack-scale plug-and-play offering for AI data centers, Nvidia is capturing a larger share of data center revenue than in the past.
On the Q2 fiscal 2027 earnings call, Nvidia's CFO Colette Kress went into detail about why Rubin is more profitable than its previous platforms:
Our second unique capability is our full-stack AI factory platform that is expanding our share of the data center TAM [total addressable market]. Since Hopper, our revenue opportunity has grown from roughly $18 billion per gigawatt to $25 billion with Blackwell, to $40 billion with Vera Rubin, which now spans Vera CPU, Rubin GPU, NVLink, InfiniBand or Ethernet, and Groq LPU, announced earlier this week. Our ability to extreme co-design across GPU, CPU, NVLink scale-up networking, scale-out networking, systems, algorithms, and software enables us to deliver X factor performance gain every generation. Vera Rubin exemplifies this, delivering 30x higher throughput per megawatt and 35x lower token cost relative to Grace Blackwell Ultra. We commenced production shipments of Vera Rubin earlier this month. Having already received purchase orders from every major hyperscaler, AI cloud, and system OEM [original equipment manufacturer], we expect Vera Rubin to mark the fastest product ramp in Nvidia's history.
Despite ongoing fears that Nvidia's growth would eventually slow, the company continues to prove that its large size is not yet a limiting factor, as its business is evolving from cyclical hardware sales to being the primary provider of AI computing infrastructure.
On the earnings call, Nvidia CEO Jensen Huang said he expects the vast majority of the world's data centers to be Vera Rubin NVL72 -- the official name of the rack-scale supercomputer that consists of 72 Rubin GPUs, 36 Vera CPUs, memory chips, and networking.
Nvidia is well-positioned to capture sales from new AI factories, as well as swap out racks of older Nvidia tech with this latest platform -- once again proving that Vera Rubin really is a monumental breakthrough in AI training and inference rather than a marginal upgrade over Grace Blackwell Ultra.
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Nvidia remains a high-conviction buy While it's easy to get enamored with Nvidia's quarterly results, long-term investors should focus on Nvidia's development pipeline. Nvidia used to rely mainly on one-off GPU hardware sales. Now, Nvidia is expanding into a product and service ecosystem that includes software, AI networking, and other hardware to support AI infrastructure at scale.
Nvidia's innovation shows no signs of slowing, and its business model is now far less cyclical than in the past, supporting high margins and ample free cash flow.
Add it all up, and Nvidia continues to stand out as the foundational AI stock for long-term investors to buy and hold for years, if not decades to come.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Wall Street’s latest concern about Nvidia Corp (NASDAQ:NVDA) isn’t its valuation or AI demand—it’s whether the chipmaker is financing its own growth.
Nvidia announced on Monday it will invest $3.5 billion in convertible bonds issued by Taiwanese chip designer MediaTek, deepening a partnership spanning AI infrastructure, AI PCs and automotive computing and expanding their NVLink Fusion collaboration, which lets MediaTek help customers build custom AI chips that plug into Nvidia’s rack-scale systems.
The deal reignites the “circular financing” debate, but some investors argue critics are overlooking a key distinction: building an ecosystem isn’t the same as manufacturing demand.
The investment comes just days after Nvidia faced renewed scrutiny over a series of financing initiatives, including backing AI infrastructure projects and extending financial support across its ecosystem.
Critics argue these arrangements risk creating a feedback loop in which Nvidia finances companies that ultimately become buyers of its own technology—a practice increasingly described as “circular financing.”
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Not Everyone Sees the MediaTek Deal Through That LensJoe Tigay, portfolio manager of the Rational Equity Armor Fund (HDCTX), argues critics are overlooking Nvidia’s broader strategy of using today’s AI windfall to strengthen the ecosystem that could drive its next phase of growth.
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“Critics call Nvidia’s investments circular financing, but I don’t see it that way. Nvidia is using the enormous cash flow it generates today to expand the ecosystem that will drive its growth tomorrow. If AI fails, Nvidia fails regardless—but if AI succeeds, as some of the smartest people and best-capitalized companies in the world are betting it will, then investing in more partners, more capacity and more applications is exactly what Nvidia should be doing right now,” Tigay said.
Tigay believes the MediaTek investment differs from Nvidia financing a direct customer because it helps expand the company’s underlying technology platform.
“Nvidia is financing MediaTek, so MediaTek can develop products that extend Nvidia’s architecture. That makes it less circular than Nvidia financing a customer—but it is still Nvidia using its balance sheet to accelerate ecosystem growth.”
He also argues the structure gives Nvidia strategic benefits beyond simply supporting a partner’s growth.
“Nvidia is lending MediaTek its balance sheet. MediaTek gains the capital to build Nvidia-compatible chips, while Nvidia secures creditor protection, potential equity upside and a stronger partner without acquiring the entire company.”
That distinction matters because MediaTek is not simply another Nvidia customer. The expanded partnership will help extend Nvidia’s technology stack into custom AI infrastructure, AI-enabled PCs, and software-defined vehicles—areas Nvidia has identified as key long-term growth markets.
What Nvidia Investors Should WatchWhether Nvidia’s strategy is ultimately viewed as prudent ecosystem building or “circular financing” will depend on one thing: whether AI demand continues to justify the capital flowing through the industry.
Critics argue Nvidia’s expanding financial commitments could amplify risks across its partner network if AI adoption slows. But if demand continues to grow as the company expects, investments like MediaTek could strengthen Nvidia’s competitive position by expanding adoption of its hardware, software, and networking technologies.
Nvidia has consistently framed these investments as part of a long-term strategy to grow its AI platform rather than simply sell more chips.
For investors, the MediaTek deal adds another chapter to an increasingly important debate. The key question is whether financing strategic partners that extend Nvidia’s platform creates a stronger competitive moat—or whether it risks becoming a self-reinforcing growth loop.
The answer will likely depend less on the financing structure itself and more on whether the AI ecosystem continues to deliver on its long-term growth promise.
Nvidia (NVDA +0.66%) stock has underperformed the broader semiconductor sector index so far in 2026, gaining just 16% as of this writing, compared to the 62% spike in the PHLX Semiconductor Sector index.
However, shares of the semiconductor bellwether received a nice shot in the arm following the release of its fiscal 2027 second-quarter results (for the quarter ended July 26) on Aug. 26. Nvidia stock jumped nearly 9% the following day, driven by its better-than-expected results and impressive guidance.
I won't be surprised to see Nvidia sustaining its post-earnings momentum in September and head higher. Let's see where this semiconductor stock could be by the end of next month.
Image source: The Motley Fool.
Nvidia's post-earnings pop is sustainable Nvidia's fiscal Q2 revenue jumped 106% year over year to $96.2 billion. Meanwhile, its non-GAAP earnings increased by 120% to $2.22 per share. The numbers trounced analysts' expectations of $2.09 in earnings per share on revenue of $92.3 billion.
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The good news for Nvidia investors is that the phenomenal growth rate is sustainable. The $108 billion revenue forecast for the current quarter points to a potential year-over-year increase of 89%. It is worth noting that Nvidia reported a 62% revenue jump in the third quarter of fiscal 2026. However, the biggest takeaway from Nvidia's latest quarterly report was that it expects its robust growth momentum to continue beyond the current quarter.
CFO Colette Kress noted on the latest earnings call:
We expect to grow revenue by approximately 70% in fiscal 2028. This is a supply constrained outlook.
This forecast took the market by surprise. Analysts were expecting Nvidia's revenue to increase by 44% in fiscal 2028, following an 83% spike in fiscal 2027 to $397 billion. Not surprisingly, analysts have scrambled to increase their growth expectations following the latest results.
Data by YCharts
Even then, the fiscal 2028 revenue estimate shown above doesn't align with Nvidia's guidance. Analysts, therefore, are still underestimating Nvidia's growth potential, especially considering that its fiscal 2028 revenue forecast takes supply constraints into account. If Nvidia manages to build more capacity with its supply chain partners, I won't be surprised to see it clock stronger growth.
For example, Nvidia's foundry partner Taiwan Semiconductor Manufacturing has increased its 2026 capital expenditure guidance by $8 billion to $62 billion. That would be an increase of more than 50% from its 2025 capex of $40.9 billion. Additionally, TSMC has committed to spend another $100 billion to boost its manufacturing capacity in the U.S., on top of its earlier commitment of $165 billion.
The aggressive expansion by TSMC bodes well for Nvidia, putting the latter in a solid position to capitalize on the healthy artificial intelligence (AI) infrastructure spending environment. Nvidia notes that the cloud computing industry is sitting on a backlog of more than $2 trillion. As a result, the company believes that the capital expenditures of the top five hyperscalers in the U.S. could jump from $800 billion in 2026 to $1.3 trillion in 2027.
These positive developments should rub off positively on this AI stock in September, especially considering that it trades at a really attractive valuation.
Here's why the stock will keep soaring in September Nvidia trades at 29 times earnings, a discount to the tech-focused Nasdaq-100 index's earnings multiple of 34. The stock's forward earnings multiple of 26 is slightly higher than the index's average multiple of 24. However, analysts are now anticipating a larger increase in Nvidia's earnings in fiscal 2027 to $9.29 per share. That's a potential increase of 95% over the prior year.
So, Nvidia should ideally be trading at a premium to the tech sector. Assuming it trades at 40 times earnings at the end of fiscal 2027 and its earnings per share reach $9.29, its share price could jump to $372 in six months. That's a potential 71% jump in a short time, which is why I think Nvidia stock will trade at a significantly higher level in September than it is right now.
Given that Nvidia trades at attractive multiples, investors should consider buying this AI pioneer before it surges higher in September.
Nvidia Corporation forecasts approximately 70% revenue growth in fiscal 2028, far exceeding prior Wall Street expectations and driven by robust AI infrastructure demand. Vera Rubin platform shipments have begun, with management expecting them to account for 20% of data center revenue in Q3 and significantly increase per-gigawatt revenue. Half of NVDA's data center business now comes from sovereign, neo-cloud, and enterprise customers, growing at roughly 100% annually, with innovative revenue-sharing models expanding the addressable market.
OpenAI just built an AI-designed chip that already beats Nvidia's best in early tests, and one macro investor has pinpointed exactly when Nvidia's most valuable competitive advantage disappears entirely.
Two days after the biggest quarter in semiconductor history, macro investor Jordi Visser told listeners on The Pomp Podcast that the scarcity holding up NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) has an expiration date. His argument separates near-term results from terminal value, laid out in a single line: OpenAI’s new Jalapeno silicon “a chip designed by OpenAI, by AI” and “is not going to disrupt their numbers this year, it’s not going to disrupt them next year.” Then the pivot: “Nvidia right now has scarcity, but at some point, five years from now, six years from now, it won’t have scarcity.” NVIDIA’s market cap of $5.31 trillion reflects future discounted cash flows. If the market decides GPUs are optional in a decade, that value contracts.
Record Quarter Priced Into Every Model NVIDIA’s Q2 FY2027 report delivered. Revenue landed at $96.22 billion, up 105.8% year over year, with Data Center revenue of $89.02 billion and non-GAAP EPS of $2.22. Supply commitments jumped to $279 billion, largely memory tied to Vera Rubin. See the Q2 FY2027 8-K exhibit for the full breakout.
Jensen Huang told analysts fiscal 2028 revenue should grow approximately 70% year over year, and that “at this moment, we have supply for 70%. We have more supply than 70%, but about 70%. Our demand is much higher than that.” The stock dropped 4.57% on Aug 28, 2026, from $227.98 to $217.55, though shares are up 16.79% year to date and trade at a forward P/E of 26.
Jalapeno Already Tests Better on TCO Chip analyst and 247 Wall Street contributor Eric Bleeker cited a SemiAnalysis headline reading “OpenAI Jalapeno better than Nvidia Blackwell,” noting initial tests point to superior total cost of ownership compared to Blackwell. Jim Cramer on CNBC added: “Nvidia invested 30 billion in OpenAI” and OpenAI is “downright gleeful about inventing this new chip, Jalapeno, that can compete with Nvidia’s.”
Chamath Palihapitiya made the structural case on All-In: “You’re going to look at these big companies in five years, they’re all going to have their own cloud, they’re all going to have their own models, they’re all going to have their own silicon, they’re all going to have their own data centers.”
Two Timelines Investors Must Reconcile Huang counters that OpenAI’s existing and planned commitments represent approximately 12 gigawatts of NVIDIA compute through 2030, and AI-lab demand should contribute roughly a quarter of NVIDIA’s business next year. Visser agrees on the near term, calling the current setup “the sweet spot of the infrastructure build out” with “another three to five years of needing a lot.”
The terminal value debate is where the fight lives. If custom silicon peels off even a quarter of hyperscaler workloads by 2031, the DCF supporting today’s price gets rewritten downward. If Vera Rubin’s economics of $40 billion per gigawatt keep expanding, the moat holds.
Where the AI Compute Dollars Are Landing Eli Lilly (NYSE:LLY) cited a co-innovation AI lab with NVIDIA for drug discovery and posted $22.97 billion in Q2 revenue with EPS of $8.38, raising FY26 revenue guidance to $85.0 billion to $87.0 billion. LLY shares are up 61.49% over one year.
Coinbase (NASDAQ:COIN) shows the flip side: Q2 revenue fell 18.51% to $1.22 billion, and the stock is down 21% year to date even with prediction-markets revenue past $100 million annualized.
For NVIDIA investors, the forward question is direct. If Jalapeno and successors take even a slice of inference workloads by 2030, does the current multiple compress before fiscal 2028 growth arrives? Watch memory pricing, hyperscaler capex mix, and how quickly OpenAI’s chips move from tests to deployment.
Contact [email protected] for any questions or corrections.
Nvidia Corporation delivered strong Q2 '27 results and robust eFY28 guidance, supporting a bullish outlook for both NVDA and the Direxion Daily NVDA Bull 2X ETF. NVDA's revenue is diversifying beyond hyperscalers, with supply constraints—not demand—limiting even higher growth, especially as Vera Rubin boosts revenue per gigawatt by 60%. NVDU offers amplified upside for active traders but carries significant risk due to volatility decay and compounding drag over multi-day periods.
Key Takeaways NVIDIA leads Arm on growth, platform breadth, cash generation and valuation.NVIDIA expects Q2 revenues of about $91B, implying nearly 95% year-over-year growth.Arm's AI growth is offset by rising expenses, revenue variability and production-silicon execution risks. Arm Holdings plc (ARM - Free Report) and NVIDIA Corporation (NVDA - Free Report) are both major beneficiaries of the AI computing boom, with their technologies increasingly intertwined across data centers and next-generation computing platforms.
Nvidia dominates AI accelerators through its GPUs, while Arm provides the energy-efficient CPU architecture increasingly used alongside those accelerators. Nvidia itself relies on Arm-based CPUs in platforms such as Grace and Vera, while Arm is expanding further into AI infrastructure with its own AGI CPU. Both companies are therefore positioned to benefit from rising spending on AI servers, cloud infrastructure and power-efficient computing.
AI Momentum Balances Arm’s Execution RisksFor a semiconductor intellectual-property provider, durable growth depends on expanding its architecture across end markets, increasing the royalty earned per chip and converting long-term licenses into recurring revenues. ARM’s presence across cloud AI, edge devices and physical AI supports this framework. However, the investment case also depends on customer shipments, licensing timing and successful execution of its move into production silicon.
Arm’s first-quarter fiscal 2027 results demonstrated momentum. Revenues increased 22.4% year over year to $1.29 billion, surpassing the Zacks Consensus Estimate by 1.8%. Royalty revenues rose 22% to $715 million, while license and other revenues advanced 23% to $574 million. Non-GAAP earnings increased 28.6% to 45 cents per share and beat the consensus estimate by 12.5%.
Cloud infrastructure is becoming a growth engine. Data-center royalties more than doubled as hyperscalers expanded deployments of Arm-based processors. Neoverse adoption, Armv9 designs and increasing use of Arm technology in networking equipment broaden the royalty opportunity. Meanwhile, AI-enabled PCs, vehicles and robotics extend the architecture into markets, reducing Arm’s dependence on smartphones.
The Arm AGI CPU adds a monetization avenue beyond licensing. Demand now exceeds $2 billion across fiscal 2027 and fiscal 2028, and Arm has secured capacity supporting the $1 billion opportunity. Nevertheless, scaling production introduces manufacturing, supply-chain and execution risks that differ from its asset-light licensing model.
Arm generated $665 million in non-GAAP free cash flow, and collection and tax-payment timing aided the figure. Cost growth warrants attention: non-GAAP operating expenses increased 18%, while research and development expenses rose 20%. GAAP operating margin declined to 7.1% from 10.8%, even as the non-GAAP margin improved.
Thus, Arm’s expanding AI exposure and strong growth are balanced by spending pressure, revenue variability and execution risk.
NVIDIA’s Scale and Platform Strength Support a Bullish ViewFor an AI infrastructure provider, durable growth depends on more than selling powerful processors. It requires an integrated platform that combines computing, networking and software, strengthens customer retention and captures spending across successive stages of AI adoption. NVIDIA’s portfolio fits this framework, supporting its long-term investment case as AI use expands from model training to inference and enterprise deployment.
The company’s financial results substantiate that thesis. In the first quarter of fiscal 2027, revenues surged 85% year over year to $81.62 billion, while non-GAAP earnings per share climbed 140% to $1.87. Data Center revenues reached $75.2 billion, accounting for roughly 92% of total sales and increasing 92% year over year and 21% sequentially.
NVIDIA expects second-quarter revenues of approximately $91 billion, implying nearly 95% year-over-year growth. Its projected non-GAAP gross margin of about 75% compared with 72.7% in the prior-year quarter reflects strong operating economics. The Zacks Consensus Estimate also indicates continued revenue and earnings growth in fiscal 2027 and fiscal 2028, supporting the view that AI infrastructure spending has further room to expand.
The company’s competitive position extends beyond GPUs. Blackwell deployments are driving demand, while the announced Vera Rubin platform strengthens NVIDIA’s next-generation roadmap. InfiniBand, Spectrum-X Ethernet and NVLink broaden its exposure to AI infrastructure spending, while CUDA and the wider software ecosystem create switching costs that reinforce customer retention.
Financial flexibility provides another advantage. NVIDIA generated $50.3 billion in operating cash flow and $48.6 billion in free cash flow during the quarter. Cash, cash equivalents and marketable securities increased to $80.6 billion from $62.6 billion sequentially. The company also repurchased $19.3 billion of shares and paid $243 million in dividends. Together, rapid growth, platform breadth and substantial liquidity reinforce a favorable long-term outlook.
NVDA has Stronger Growth ProjectionsThe Zacks Consensus Estimate for NVDA’s fiscal 2027 sales and EPS indicates year-over-year growth of 85.4% and 93.3%, respectively. EPS estimates have been trending upward over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for ARM’s fiscal 2027 sales suggests 21.8% year-over-year growth, while EPS is expected to grow 24.3%. EPS estimates have been trending upward over the past 60 days.
Image Source: Zacks Investment Research
NVDA’s Valuation is CheaperWhile NVDA appears attractively valued with a forward 12-month P/E of 17.49X versus its median of 25.87X, ARM's higher forward P/E of 92.9X, below its median of 128.33X, reflects investor confidence in its strong earnings growth potential.
NVDA Seems a Better BuyBoth Arm and NVIDIA are well positioned to benefit from expanding AI infrastructure spending. Arm’s royalty-led model, growing data-center presence and broader push into production silicon support its long-term prospects, but elevated valuation, rising expenses and execution risks limit near-term upside. NVIDIA’s superior growth outlook, dominant accelerator franchise, integrated networking and software ecosystem, strong cash generation and attractive valuation provide a more compelling risk-reward profile. With its platform leadership reinforcing customer retention and capturing a wider share of AI investment, NVIDIA stands out as the better investment choice.
NVDA sports a Zacks Rank #1 (Strong Buy), while ARM carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of NVDA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Nvidia is investing $3.5 billion into Taiwanese chipmaker MediaTek. As part of the deal, MediaTek will adopt Nvidia’s technology that will help it design custom chips for AI companies and hyperscalers that can be plugged directly into Nvidia-based data centers.
The deal comes as a growing number of AI companies and major cloud providers like Amazon, Google, Microsoft, OpenAI and Anthropic invest in building their own chips so they can be less reliant on Nvidia’s GPUs. Deals like this one with MediaTek allow Nvidia to cede ground to custom silicon while still maintaining its lead as the dominant data center scaffolding.
“Nvidia is an AI infrastructure company,” Dion Harris, Nvidia’s senior director of HPC and AI hyperscaler infrastructure solutions, said on Monday on a call with reporters. “We expanded beyond pure computing chips years ago.”
The partnership underscores the circular nature of Nvidia’s financing efforts over the past few years, which have often seen the chip giant investing in companies that flow back into its own ecosystem. The deal will give MediaTek access to Nvidia’s NVLink Fusion ecosystem, including NVLink, the technology that lets any chips — even if they’re not Nvidia’s chips — communicate with each other quickly.
Last week, Nvidia announced a similar partnership with Amazon Web Services, albeit without the direct investment. AWS will deploy an additional 2 million Nvidia GPUs across its infrastructure, and also integrate NVLink Fusion.
With the Nvidia partnership, MediaTek can continue to build custom chips designed by cloud companies or AI labs tailored to their workloads, leveraging Nvidia’s “proven scale-up and scale-out technology stack and ecosystem” and “rack-scale architecture.”
“Basically, every cloud, every model builder is deploying our platform in some shape, form, or fashion,” Harris said. “So by MediaTek being able to offer this extension to its customers, it allows them to standardize on the rack-scale infrastructure across their AI factories… and also deploy their [custom chips] right alongside those using the same standard platform.”
“This is really about opening up this ecosystem to the entire MediaTek customer base,” Harris continued.
MediaTek hasn’t publicly shared information about its customer base as it relates to custom AI chips, but it’s clear Nvidia aims to help it boost that side of the business so long as it can come along for the ride. MediaTek has been slowly building its custom data center ASIC (application-specific integrated circuit) operations, saying in June that it expects the business to generate $2 billion in revenue in 2026, and hopes to target more of the market in the coming years.
Given MediaTek’s expertise in developing custom chips that power smartphones, smart homes, automobiles, and wireless communications, the company will also continue to collaborate with Nvidia on DGX Spark, the company’s small developer-focused desktop AI computer. The companies have extended their collaboration with the RTX Spark, Nvidia’s push to put its AI tech into consumer AI PCs.
MediaTek and Nvidia will also continue “developing platforms for AI-powered, software-defined vehicles in the era of physical AI,” per a press release. MediaTek’s auto platforms rely on Nvidia’s RTX graphics for intelligent vehicle cockpits and work, alongside Nvidia Drive AGX, the company’s in-car computing platform for autonomous driving workloads.
“AI is transforming every computing platform — from the world’s largest AI factories to the PC and the car,” Jensen Huang, founder and CEO of Nvidia, said in a statement. “Together, we’re building platforms that bring NVIDIA accelerated computing to new markets and give customers the freedom to create differentiated AI systems at enormous scale.”
When you purchase through links in our articles, we may earn a small commission. This doesn’t affect our editorial independence.
Rebecca Bellan is a senior reporter at TechCrunch where she covers the business, policy, and emerging trends shaping artificial intelligence. Her work has also appeared in Forbes, Bloomberg, The Atlantic, The Daily Beast, and other publications.
You can contact or verify outreach from Rebecca by emailing [email protected] or via encrypted message at rebeccabellan.491 on Signal.
Nvidia (NVDA) stock rose toward a buy point Monday, capping off a winning August after the artificial intelligence chipmaker this month broke out following a beat-and-raise report for its second quarter.
With a market cap of $5.2 trillion, Nvidia has reclaimed its crown as the most valuable company on the stock market. Apple (AAPL) was knocked off that perch recently after the stock sold off following its earnings report in July. So, is Nvidia stock a buy or sell now?
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Chip Stocks Got Too Hot. Now What?
Franklin Equity portfolio manager Jonathan Curtis breaks down why he believes the semiconductor selloff doesn’t signal a downturn, with AI demand remaining strong, chip supply still constrained and hyperscaler spending continuing to support the trade.
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On Friday, famed investor Cathie Wood's ARK Invest bought 243,707 Nvidia shares valued at around $53 million.
Late Wednesday, the AI giant posted second-quarter adjusted earnings of $2.22 a share on sales of $96 billion, up about 120% and 106% year over year, respectively. Wall Street had targeted earnings of $2.08 and $92 billion in sales. The company's current-quarter revenue projection of $108 billion topped views by $3 billion.
Management noted supply constraints through fiscal 2028 that will allow Nvidia to meet 70% of demand. Meanwhile, Chief Financial Officer Colette Kres said Nvidia's circular financing will lead to two payoffs: through its hardware sales and from its revenue share at its partners.
Partnership With Amazon
The company also solidified its partnership with Amazon (AMZN), with the e-commerce company ordering 2 million of Nvidia's processors and adopting its full-stack physical AI platform to enable its warehouse robot fleet.
Following the conference call, analysts Quinn Bolton, Neil Young and others at Needham noted that data centers – the end-market that could be Nvidia's biggest growth engine – will continue to undergo a shift toward accelerated computing and AI.
Bolton raised his targets for the third quarter to $2.46 per share and sales of $109 billion. He previously expected earnings of $2.34 and $103 billion in sales. Needham has a price target of 300 for Nvidia stock with a buy rating.
In terms of its 12-month price performance, Nvidia has outperformed just 59% of all other stocks in Investor's Business Daily's database.
Funds own 42% of the company's outstanding shares, according to IBD MarketSurge research. The stock's Accumulation/Distribution Rating of D- indicates funds have been net sellers of the stock recently. The rating measures price and volume action over the last 13 weeks.
But the AI chip behemoth has a top-level Earnings Per Share Rating of 99. Further, the stock's all-around strength, or Composite Rating, is 91.
Is Nvidia Stock A Buy?
Looking at chart signals and technical measures can help investors assess whether Nvidia stock is a buy or sell now.
Nvidia stock on Thursday broke out of a cup-with-handle with a 227.92 buy point following an earnings beat. The stock is below the pivot on Monday.
Please follow VRamakrishnan on X/Twitter for more news on the stock market today.
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Following a beat-and-raise earnings report for its fiscal second quarter last week, artificial intelligence behemoth Nvidia (NVDA) continues to tease a fresh breakout. And as it holds support above its 10-week moving average, Nvidia stock has also secured a spot on the Investor's Business Daily Leaderboard and the Stock Spotlight screen.
More than a dozen Wall Street analysts raised their price targets on Nvidia after its bullish report. Now as a new week in the stock market kicks off, shares of the AI giant take aim at a new buy point in an early stage cup with handle, putting certain technical clues in focus.
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AI Profitability In Spotlight As Dell, Palo Alto, Snowflake Report Earnings
IBD's Alexis Garcia and Ed Carson preview key upcoming earnings reports from Dell Technologies, Palo Alto Networks and Snowflake.
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Robust Growth Forecast For This Fiscal Year — And Next
In its latest report, Nvidia posted another quarter of stellar growth. Revenue rose 85% to $81.6 billion. Earnings spiked 130% to $1.87 per share. For the full fiscal year, analysts forecast 89% sales growth to $407.27 billion and a 94% earnings increase to $9.27 a share.
Wall Street expects similarly stellar numbers for the next fiscal year as well. Analyst estimates call for a 67% jump in sales growth to $681.18 billion and a 67% spike in earnings to $15.52 a share.
That bullish outlook has Nvidia stock flashing promising technical clues.
Nvidia Stock: What Investors Need To Know
Read Between These Lines To Assess Nvidia Stock
In a sign of rising strength, the 21-day exponential moving average crossed back above the longer-term 50-day line in early August and has continued to rise since then. Investors should also note how the AI juggernaut successfully held support at its 50-day benchmark the week heading into earnings.
On Monday, shares continue to hold above the 21-day line to further demonstrate Nvidia's resilience. Nvidia has formed a cup with handle showing a 227.92 buy point. Shares edged higher Monday to close in on that entry.
Nvidia NVDA shares rose nearly 1% on Monday after the chipmaker announced a $3.5 billion investment in Taiwan-based MediaTek, deepening a partnership focused on artificial intelligence (AI) infrastructure and data-center technology.
Nvidia will purchase bonds convertible into MediaTek shares, according to a joint statement from the companies.
The transaction represents Nvidia's largest direct investment outside the US and comes as the company works to expand the reach of its technology across the AI hardware ecosystem.
The expanded partnership will see MediaTek adopt Nvidia's NVLink Fusion and newly announced NVHBM technologies.
The tools are designed to help components communicate more efficiently within data centers, allowing MediaTek's technology to integrate more closely with systems used by major cloud and technology companies.
Nvidia CEO Jensen Huang described the agreement as a significant expansion of an existing relationship.
"We've already had a big partnership with MediaTek. Today, we are going to make it a lot bigger," Huang said in an interview with Bloomberg Television. He added that the companies' engineering roadmap extends for a decade.
The agreement is part of Nvidia's broader effort to maintain a central position in AI infrastructure even as major customers develop their own chips.
MediaTek is seeking to expand beyond its traditional reliance on the smartphone market and is increasingly positioning itself as a design partner for large technology companies developing custom AI processors.
Its recent partnerships include Alphabet's Google, while Nvidia and MediaTek are also working together on the chipmaker's efforts to enter the laptop market.
MediaTek is helping Nvidia develop its RTX Spark product for laptops.
The Taiwanese company previously forecast AI chip sales of about $2 billion this year and is targeting a 15% share of an $80 billion segment next year.
The Nvidia investment follows a similar expansion of cooperation with Amazon.
Amazon agreed to deploy an additional 2 million Nvidia components and use Nvidia's connection technology with its own internally developed chips.
Huang said the expanded relationship means both companies are broadening their respective supply chains.
MediaTek's XPU technology will become part of Nvidia's supply chain, while Nvidia's networking ecosystem becomes part of MediaTek's.
The deal comes as hyperscalers including Amazon, Google and Microsoft increasingly develop in-house chips to complement or replace some Nvidia hardware.
Despite those efforts, Nvidia continues to forecast strong growth. The company expects sales to increase by more than 70% next year.
The scale of Nvidia's investment in companies across the AI ecosystem has also raised concerns among some investors about potentially circular relationships between chip suppliers and their customers.
Huang rejected that characterization in discussing the MediaTek agreement.
"This is not circular because obviously they do their own business and we do our own business, and MediaTek is already incredibly profitable, incredibly successful," Huang said.
Meanwhile, Melius Research raised its Nvidia price target to $420 from $400 while maintaining a Buy rating. The firm highlighted Nvidia's expectation for more than 70% revenue growth next year despite lower gross margins.
Nvidia's purchase commitments also increased to $279 billion from $119 billion, while total commitments reached $366 billion, largely reflecting memory requirements.
The company said it plans to return more than 60% of free cash flow to shareholders, with buybacks expected to increase next year.
Melius raised its fiscal 2029 earnings-per-share estimate to $21.11 and based its new price target on a multiple of 20 times that estimate.
The firm said Nvidia could be approaching another breakout, although it acknowledged continuing concerns surrounding the broader AI trade.
An expanded partnership with MediaTek shows that Nvidia is interested in making its AI ecosystem compatible with the world of custom chips, a portfolio manager says.
Trump fired a warning shot at communities blocking data centers, but a growing revolt stretching from Texas to Arizona reveals the $1 trillion AI buildout faces a political obstacle that no Truth Social post can easily bulldoze.
President Donald Trump on Monday, August 31, 2026 at 9:59 AM issued a Truth Social post warning U.S. communities against blocking data center development, escalating a public feud over the AI infrastructure buildout that now spans both parties.
“The only reason that communities throughout the U.S.A. should not want Data Centers is if they want to end up being backwards and poor. If they want to be successful and rich, with far lower taxes and jobs all over the place, let Data Reign. The good news is that there are plenty of other places that want them. If we kill the Golden Goose, you will only have yourselves to blame. China could not be happier with this anti Data Center movement. Actually, they can’t believe it is happening! President DJT” the post read. As of capture, it had drawn 3,174 replies, 2.94k ReTruths and 11.2k Likes, and was covered by Politico, Newsweek, the Washington Times and the Washington Examiner.
Scoping the $1 Trillion Figure Goldman Sachs Research published “Global AI Investment Is Forecast to Exceed $1 Trillion in 2026” on August 7, 2026. The figure represents global spending in the 2026 calendar year, not a cumulative or lifetime total. Goldman revised the number upward from a previously cited consensus of $794 billion. Roughly $581 billion of the 2026 global figure is expected to land in the U.S., according to Goldman Sachs Research.
McKinsey has estimated cumulative data center investment of $5.2 trillion to $7.9 trillion by 2030, and NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) CEO Jensen Huang has publicly cited $3 trillion to $4 trillion by the end of the decade.
Backlash by the Numbers A Gallup survey, reported by The New Republic on Aug. 27, 2026, found 71% of Americans oppose new data center construction in their communities, with 48% strongly opposed, exceeding Gallup’s historical peak opposition to nuclear power plants at 63%. 24/7 Wall St. covered that finding in an Aug. 20 piece on a Kentucky family declining $26 million for a data center on their farm.
Brookings reported that local opposition blocked or delayed 75 projects worth $130 billion in Q1 2026, matching all of 2025 in three months. McKinsey partner Maria Goodpaster told Bloomberg on Aug. 26, 2026: “Community backlash is very real… some investments have already been made and now we’re seeing players pivot from those and abandoning some sites.” CNBC on Aug. 29, 2026 reported protests drawing hundreds of people in Arizona, Michigan and Pennsylvania.
Why Communities Object The Colorado General Assembly’s report, Data Center Impacts on the Environment, Public Health, and Energy Costs, compiles underlying grievances. The Department of Energy projects data centers will account for up to 12% of U.S. electrical demand by 2028, driven by AI development. The U.S. Energy Information Administration reports national retail electricity prices have increased faster than inflation since 2022. Reporting by the New York Times and the Environmental and Energy Study Institute found communities may experience water scarcity and other water-related challenges following the arrival of data centers, compounded in areas with pre-existing scarcity.
State legislatures are responding. California Senate Bill 57 authorizes the Public Utilities Commission to assess the financial impact of large data centers on electrical corporations and customers and identify opportunities to prevent or mitigate cost shifts.
Abbott and an Intra-Party Fight Today’s post escalates an existing dispute. On August 9, 2026, Trump publicly criticized Texas Governor Greg Abbott’s moratorium on data centers connecting to the power grid, as reported by KEYE. In early August 2026, Abbott ordered a pause on new data center approvals pending an audit by ERCOT and the Public Utility Commission of Texas of energy and water usage, a temporary freeze reported by Reuters, Axios, the Texas Tribune, USA Today and Houston Public Media. The Cool Down reported on August 30, 2026 that the halt affects up to 1,800 projects, and Texas is facing an estimated 474 GW of interconnection requests, according to Utility Dive. Reason Magazine framed the reversal as notable given Abbott had previously called Texas the “epicenter” of AI.
What to Watch Into the Midterms The dispute puts electricity prices, water use and permitting on the ballot heading into the 2026 midterms, with state-level actors in both parties navigating the same voter data. As Vox framed it via Brookings: “Americans don’t know how to fight AI. So they’re fighting data centers.” For investors watching the buildout from the other side, the power, cooling, and networking suppliers behind these projects are worth a closer look (we profiled seven of them in a free report here: 7 Stocks Powering the AI Boom (That Aren’t Chipmakers)). All figures cited above are projections or reported estimates, not outcomes. This article is not investment advice.
Contact [email protected] for any questions or corrections.
The "Magnificent Seven" stocks have captured a lot of headlines over the years, but they haven't been as impressive recently. The Roundhill Magnificent Seven ETF (MAGS -0.78%), a fund that exclusively tracks them, is only up by 5% year to date.
It's trailing the S&P 500 and Nasdaq Composite this year. There are a few key details investors should consider when assessing whether the underperformance is temporary or part of a long-term trend.
Image source: Getty Images.
Tesla is dragging down the Magnificent Seven Most of the Magnificent Seven stocks are still up year to date. The low returns from the Roundhill Magnificent Seven ETF are largely due to Tesla's (TSLA +4.34%) poor performance. The electric vehicle maker's stock is down by more than 20% year to date.
The company's profit margins continue to narrow despite rising revenue. One big concern is that Tesla is losing ground to Waymo in the autonomous vehicle race, a critical piece of Tesla's lofty valuation.
Meta Platforms (META -1.31%) has also endured a tough stretch despite posting rising revenue. A legal battle has forced the company to limit teens to two hours per day on Facebook and Instagram, cumulatively, time that can be extended with a parent's permission. It's big news for child safety advocates, but it's unlikely to make a big impact on Meta Platforms' financial results.
Alphabet (GOOG -2.63%) (GOOGL -2.49%), Amazon (AMZN -2.38%), and Microsoft (MSFT -0.80%) continue to do well in multiple industries, with their respective cloud computing platforms accelerating rapidly due to artificial intelligence (AI). Accelerated iPhone demand has been helping Apple (AAPL -1.34%) outperform the S&P 500, and Nvidia (NVDA +1.06%) continues to crush Wall Street forecasts.
Valuations aren't as good as they appear Most of the Magnificent Seven stocks are still gaining market share and posting respectable growth rates. In fact, all of them posted higher revenue growth rates in the second quarter than the blended revenue growth rate for the S&P 500.
That has resulted in some attractive price-to-earnngs (P/E) ratios. For instance, Alphabet trades at a P/E or 17 and Amazon at 21.
These valuations are good for the type of net income growth those companies are achieving, but a closer look at the numbers indicates that the net income improvements aren't as good as they appear. Alphabet and Amazon both include gains from their investments in SpaceX and Anthropic in their net incomes, which has inflated their earnings. Operating income, which isn't reflected in the P/E ratio, is a more useful metric for reviewing those two companies.
Investment gains are why Alphabet's net income rose by 298% year over year in the second quarter but its operating income increased by only 30% year over year. This lower figure is a more accurate assessment of how well Alphabet's underlying business performed.
Microsoft and Nvidia also use this strategy to artificially boost net income. Meta Platforms, Apple, and Tesla avoid this accounting practice, so their P/E ratios more accurately reflect the value of the underlying business.
Smaller companies are achieving higher growth rates Most of the Magnificent Seven stocks have produced serviceable year-to-date returns, with some of them outperforming the S&P 500. They also tend to have good fundamentals and are well positioned for the AI boom.
However, growth investors who want higher returns might consider smaller companies that are posting high revenue growth rates. Nvidia is the only Magnificent Seven stock that is producing otherworldly revenue growth. The AI chipmaker's sales rose by 106% year over year in its fiscal 2027 second quarter (ended July 26).
The Magnificent Seven have produced generational returns for early investors, but if you are looking for a stock that can produce generational returns, you should probably focus on smaller companies. It's easier for a company with a $10 billion market cap to reach a $100 billion valuation than it is for Nvidia to jump from a $5 trillion valuation to $50 trillion. It simply requires far more capital for Nvidia to increase its value 10-fold than it does for a smaller company to achieve that same growth rate.
Smaller companies like Silicon Motion Technology (SIMO -1.30%) and Nebius (NBIS -3.05%) get my attention because they are more than doubling revenue year over year. They also have smaller market caps and are less well known than the Magnificent Seven. The tech giants are not as risky, but higher returns are available for people who dig for smaller AI stocks.
Marc Guberti has positions in Apple and Silicon Motion Technology. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool has a disclosure policy.
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Companies Expand Collaboration Across Multigenerational Cloud AI Factories, Local AI Computing and Automotive MediaTek to Adopt New NVIDIA NVLink Fusion Platform, Helping Customers Take Custom XPUs to NVIDIA NVLink-Connected, Rack-Scale AI Factories SANTA CLARA, Calif., Aug. 31, 2026 (GLOBE NEWSWIRE) -- NVIDIA and MediaTek today announced a deepening of their longstanding collaboration to build the next generations of AI computing platforms — spanning AI infrastructure, local AI computing and automotive.
As part of the expanded collaboration, MediaTek will adopt the NVIDIA NVLink Fusion™ platform to provide hyperscalers, cloud service providers and frontier model developers with a prevalidated path to develop custom XPUs and bring them into NVIDIA NVLink™-connected, rack-scale AI factories.
The companies combine NVIDIA’s accelerated computing, AI, graphics and software platforms with MediaTek’s leadership in custom silicon, high-performance computing, power-efficient system-on-chip (SoC) design, advanced packaging, interconnects and connectivity.
NVIDIA has also invested $3.5 billion in convertible bonds issued by MediaTek.
NVIDIA and MediaTek are collaborating in three major areas:
AI infrastructure: MediaTek will work with NVIDIA’s NVLink Fusion ecosystem to enable customers to develop custom AI infrastructure designed to integrate with NVIDIA rack-scale systems and AI factories.Local AI computing: The companies will continue to collaborate on multiple generations of NVIDIA RTX Spark™ and DGX Spark™ PC chips, powering consumer PCs, AI developer supercomputers and enterprise-class workstations, that integrate NVIDIA GPUs with MediaTek SoCs.Automotive: MediaTek and NVIDIA will continue developing platforms for AI-powered, software-defined vehicles in the era of physical AI.
“AI is transforming every computing platform — from the world’s largest AI factories to the PC and the car,” said Jensen Huang, founder and CEO of NVIDIA. “MediaTek is one of the world’s great semiconductor companies, with exceptional expertise in system-on-chip design, connectivity, leading performance and power efficiency. Together, we’re building platforms that bring NVIDIA accelerated computing to new markets and give customers the freedom to create differentiated AI systems at enormous scale.”
“MediaTek and NVIDIA share a vision for making advanced AI computing pervasive across the technology landscape,” said Rick Tsai, vice chairman and CEO of MediaTek. “NVIDIA’s investment strengthens a collaboration that spans cloud AI infrastructure, local AI computing and automotive in the era of physical AI. By combining NVIDIA’s leadership in accelerated computing and AI software ecosystem with MediaTek’s expertise in a diverse AI technology portfolio from edge to cloud, and our leadership position in custom silicon, we can accelerate innovation for our customers.”
Building Custom AI Infrastructure With NVLink Fusion Platform
MediaTek will offer the NVLink Fusion platform as a design foundation for customers developing custom AI accelerators, enabling their platforms to evolve alongside future NVIDIA architectures.
The NVLink Fusion platform provides a prebuilt, prequalified and system-prevalidated foundation for multi-die XPU development — accelerating the path from silicon and advanced packaging to rack-scale systems.
The NVLink Fusion platform brings together the critical technologies surrounding a custom XPU, including:
NVIDIA NVLink Fusion chiplet, connecting XPUs to the NVIDIA NVLink scale-up fabric using NVIDIA photonics or electrical interconnects.NVIDIA NVLink-C2C, providing high-bandwidth, energy-efficient connectivity between XPUs, NVIDIA Rosa CPUs and other compatible processors.NVIDIA NVHBM, integrating customized memory capabilities to increase bandwidth and energy efficiency while dedicating more silicon area to compute.
Building a custom accelerator is only the beginning of deploying custom XPUs in rack-scale AI factories. Integrating multi-die architectures, advanced packaging, high-speed SerDes, HBM, I/O and scale-up networking into a manufacturable, production-ready system requires extensive chip-to-rack engineering, qualification and supply-chain support.
Rather than engineering and qualifying every element surrounding a custom XPU from the ground up, customers can focus resources on the differentiated compute that defines their platforms while relying on NVIDIA and MediaTek for the NVLink connectivity, memory architecture, packaging, manufacturing and rack-scale technologies required for production deployment.
Customers can bring their XPU designs to MediaTek and tailor connectivity, memory, packaging, performance and power characteristics to their workloads and infrastructure requirements.
Additionally, MediaTek is part of the broader NVIDIA NVLink Fusion ecosystem, which enables hyperscalers, cloud service providers and frontier model developers to seamlessly connect custom XPUs to NVIDIA’s AI infrastructure.
With NVLink Fusion, partners can leverage NVIDIA’s proven scale-up and scale-out technology stack and ecosystem, as well as the NVIDIA MGX™ rack-scale architecture, to reduce development complexity, increase performance and accelerate time to market for semi-custom AI factories.
Bringing Supercomputers to Local AI Computing
NVIDIA and MediaTek are collaborating to advance local AI computing for the era of generative and agentic AI, combining NVIDIA’s leadership in accelerated computing with MediaTek’s expertise in high-performance, power-efficient system-on-chip design.
MediaTek collaborated with NVIDIA on the GB10 Grace Blackwell Superchip that powers NVIDIA DGX Spark, which combines an NVIDIA Blackwell GPU and Grace CPU connected by NVLink-C2C to bring powerful AI capabilities to edge systems. The companies have extended their collaboration with NVIDIA RTX Spark to power the next generation of consumer PCs redefined for the AI era.
Advancing the AI-Defined Vehicle in the Era of Physical AI
Additionally, NVIDIA and MediaTek are collaborating across multiple generations to advance AI-powered, software-defined vehicles, combining MediaTek’s automotive system-on-chip design leadership with NVIDIA’s accelerated computing, AI, graphics and software.
MediaTek Dimensity Auto platforms integrate NVIDIA technologies to deliver advanced AI and NVIDIA RTX™ graphics for intelligent vehicle cockpits and can work alongside NVIDIA DRIVE AGX™. The companies continue to build on this foundation across future generations, creating a scalable architecture for increasingly intelligent, AI-defined vehicles.
About MediaTek
MediaTek (TWSE: 2454) is a global leader in fabless semiconductor design, powering AI from the edge to the cloud.
About NVIDIA
NVIDIA (NASDAQ: NVDA) is the world leader in AI and accelerated computing.
For further information, contact:
Allie Courtney
Corporate Communications
NVIDIA Corporation [email protected]
Toshiya Hari
Investor Relations
NVIDIA Corporation [email protected]
MediaTek Forward-Looking Statements
The information contained in this press release relates solely to the business collaboration between MediaTek and NVIDIA and is intended to describe the nature and context of the collaboration between MediaTek and NVIDIA. It does not constitute, and should not be construed as, any business, operational, financial, revenue, earnings, or other forecast information under applicable Taiwan laws and regulations. The implementation, success, and commercial outcome of the collaboration, including any related product development activities, are subject to various uncertainties and risks. Important factors include the impact of competitive products and pricing, timely acceptance of products design by our customers, timely introduction of new technologies, ability to ramp new products into volume, industry wide shifts in supply and demand for semiconductor products, market oversupply, availability of manufacturing capacity, financial stability in end markets, potential difficulties in talents retention, unexpected costs and expenses, global economic conditions or non-economic conditions and any other risks factors. MediaTek makes no representation, warranty, or assurance regarding the achievement of any anticipated objectives, milestones, performance, or results arising from the collaboration. Investors are advised to exercise independent judgment and conduct their own evaluation before making any investment decision. Any investment decision should not be based solely on the information contained in this press release.
MediaTek, MediaTek logo, and Dimensity Auto are trademarks and/or registered trademarks of MediaTek Inc. All other company names, product names, service marks, and logos referenced herein may be trademarks or registered trademarks of their respective owners.
NVIDIA Forward-Looking Statements
Certain statements in this press release including, but not limited to, statements as to: expectations with respect to NVIDIA’s partnership with MediaTek, and the benefits and impact thereof; expectations with respect to growth, performance, availability, and benefits of NVIDIA’s products, services and technologies, and related trends and drivers; expectations with respect to technology developments, and related trends and drivers; projected market growth and trends; expectations with respect to AI and related industries; and other statements that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the “safe harbor” created by those sections based on management’s beliefs and assumptions and on information currently available to management and are subject to risks and uncertainties that could cause results to be materially different than expectations. Important factors that could cause actual results to differ materially include: global economic and political conditions; NVIDIA’s reliance on third parties to manufacture, assemble, package and test NVIDIA’s products; the impact of technological development and competition; development of new products and technologies or enhancements to NVIDIA’s existing products and technologies; market acceptance of NVIDIA’s products or NVIDIA’s partners’ products; design, manufacturing or software defects; changes in consumer preferences or demands; changes in industry standards and interfaces; unexpected loss of performance of NVIDIA’s products or technologies when integrated into systems; NVIDIA’s ability to realize the potential benefits of business investments or acquisitions; and changes in applicable laws and regulations, as well as other factors detailed from time to time in the most recent reports NVIDIA files with the Securities and Exchange Commission, or SEC, including, but not limited to, its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Copies of reports filed with the SEC are posted on NVIDIA’s website and are available from NVIDIA without charge. These forward-looking statements are not guarantees of future performance and speak only as of the date hereof, and, except as required by law, NVIDIA disclaims any obligation to update these forward-looking statements to reflect future events or circumstances.
Nvidia (NVDA.O) said on Monday it was investing $3.5 billion in Taiwan's MediaTek (2454.TW), the latest deal to widen the U.S. chipmaker's financial ties across the AI industry.
The move follows Nvidia's up to $105 billion guarantee earlier this month for OpenAI's Ohio data-center lease and could intensify scrutiny of arrangements where the chipmaker funds companies that help drive demand for its AI products.
Nvidia's investment is part of MediaTek's record $3.9 billion overseas convertible bond offering. The Taiwanese chipmaker said Alphabet (GOOGL.O), a key AI infrastructure partner, also took part in the offering, but did not disclose the size of the search giant's investment.
"This is not circular because obviously they do their own business and we do our own business," Nvidia CEO Jensen Huang said in an interview with Bloomberg TV, about its investment in MediaTek.
As part of Monday's deal, MediaTek will let customers use Nvidia's technology to design their own AI chips that connect directly to Nvidia's larger computing systems.
The technology, called NVLink Fusion, gives chipmakers ready-made connectors and specialized memory so custom AI chips can plug into Nvidia's larger data-center systems.
It saves customers time and engineering costs, letting them focus on their own chip designs rather than building connections to Nvidia's systems from scratch.
"Nvidia is financing MediaTek so MediaTek can develop products that extend Nvidia's architecture," said Joe Tigay, portfolio manager of the Rational Equity Armor Fund. "That makes it less circular than Nvidia financing a customer—but it is still Nvidia using its balance sheet to accelerate ecosystem growth."
The Santa Clara, California-based chip giant and MediaTek will also keep working together on chips for personal computers and technology for AI-powered vehicles.
The latest deal builds on a broader relationship between Nvidia and MediaTek. In June, the companies teamed up to launch the RTX Spark PC chip, aiming to bring AI features directly to laptops and desktops.
Nvidia's investment in MediaTek comes days after the U.S. chipmaker provided a rare long-term outlook of 70% revenue growth for next year, with Huang saying AI has reached its inflection point and is doing useful work.
MediaTek, meanwhile, has been pushing beyond smartphones into AI chips for data centers, backed by a $5 billion financing plan approved in July.
Nvidia Corp. Chief Executive Officer Jensen Huang and Rick Tsai, MediaTek Inc. CEO, talk about expanding their partnership. Nvidia is investing $3.5 billion in the Taiwanese chipmaker.
Nvidia is investing $3.5 billion in MediaTek, deepening collaboration with the Taiwanese chipmaker as it's working to persuade more companies to build chips that plug into its dominant data center ecosystem. Nvidia CEO Jensen Huang and MediaTek CEO Rick Tsai join Bloomberg's Ed Ludlow in this exclusive interview to discuss the deal.
In this video, I will cover Nvidia's (NVDA +1.06%) earnings report and explain which other stocks and companies stand to benefit most from the results and management's comments. Watch the short video to learn more, consider subscribing, and click the special offer link below.
*Stock prices used were from the trading day of Aug. 27, 2026. The video was published on Aug. 27, 2026.
Neil Rozenbaum has positions in Advanced Micro Devices, Micron Technology, and Nebius Group. The Motley Fool has positions in and recommends Advanced Micro Devices, Micron Technology, and Nvidia. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of NVDA, GEV either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
NVIDIA just posted the largest single quarter in semiconductor history, yet shares trade nearly 50% below where one price target says they belong. The math behind that gap reveals something Wall Street's consensus may be missing.
NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) just reported the largest single quarter in semiconductor history, yet trades well below where fundamentals suggest.
Data Center revenue hit $89.02 billion in Q2 FY27, up 117% year over year, and CEO Jensen Huang told investors “AI has reached its inflection point. It’s doing useful work. Its tokens are productive and profitable. Now, compute is revenue.” Shares are up just 12.55% YTD. Can NVIDIA hit $350 by 2027?
Why NVIDIA Shares Are Stuck Despite Record Fundamentals For a stock that just doubled quarterly revenue, momentum has stalled. NVDA is down 3.63% over the past week and up only 6.69% over the past month. One-year returns of 15.49% lag the underlying earnings trajectory.
Three headwinds weigh on shares. First, with a beta of 2.215, NVDA swings sharply with sentiment, and every AI capex headline invites scrutiny.
Second, management guided Q3 gross margin down to 74% with a Q4 trough in the 71% to 72% range as memory prices spike.
Third, the outlook assumes no Data Center compute revenue from China. Investors are pricing in risks before growth.
Wall Street Sees 33% Upside. Our Model Says the Setup Is Better The Street is nearly unanimous. There are 10 Strong Buy, 48 Buy, 2 Hold, and 1 Sell ratings, with consensus target of $304.73. Our internal model puts base case at $289.96 with bull case of $334.53 and bear case of $247.21. Confidence is rated high at 0.9.
The consensus looks conservative. With 95% of analysts bullish and YoY earnings growth at 214.5%, the $304 target ignores what Vera Rubin does to unit economics.
Path to $350 Per Share Reaching $350 from today’s price of $229.77 requires a 52.3% gain. For a mega-cap, that is substantial but maps to the math.
With forward EPS of $9.91, a $350 price implies a forward P/E of roughly 35x. Our base case of $289.96 already implies 33x, meaning $350 needs only about 3 turns of additional multiple expansion. That is a modest gap given the growth.
The bull case rests on three pillars. Vera Rubin, which management says is “the fastest product ramp in NVIDIA’s history” and generates roughly $40 billion per gigawatt versus $25 billion for Grace Blackwell.
Hyperscaler capex expected to reach $1.3 trillion in 2027. And FY28 revenue growth guidance of approximately 70%, which Huang called “a supply-constrained outlook”. Our model’s adjustment factor of 1.138 reflects that setup.
Primary risk: any hyperscaler capex pullback or memory-driven margin miss would break the multiple story instantly.
Where NVIDIA Trades Today vs Its Earnings Power At $229.77, NVDA trades at roughly 23x forward earnings against forward EPS of $9.91. For a company growing revenue over 105% year over year with 63% net margin, that is not expensive.
Shares sit between a 52-week low of $163.85 and high of $236.26. The 10-year return of 13,660.88% reminds investors this stock has repeatedly punished those anchored to short-term multiples.
Is $350 Realistic? My Verdict Reaching $350 requires a 52.3% gain and 35x forward earnings. It is a stretch but not a fantasy.
Three things must break right: Vera Rubin ramps on schedule, margin troughs in the 71% to 72% range as promised, and hyperscaler capex lands near the $1.3 trillion 2027 figure. Softening in AI infrastructure spend or a repeat of the China export shock would derail it.
The traits that showed up in past monster tech runs are the ones we cataloged in a free playbook here. Returns at this level shouldn’t be expected annually, but we’ve outlined the blueprint for how NVIDIA could reach $350 in 2027.
Contact [email protected] for any questions or corrections.
Nvidia Corp. Chief Executive Officer Jensen Huang and Rick Tsai, MediaTek Inc. CEO, talk about expanding their partnership. Nvidia is investing $3.5 billion in the Taiwanese chipmaker.
31.8.2026 16:00, NVDA, EIX, LLY, PCG, SLB, CVX, XOM
Index Dow Jones -0,61 % na 53232,61 b., S&P 500 -0,41 % na 7680,52 b., Nasdaq Composite -0,31 % na 26320,91 b.
Americké akcie zpočátku týdne oslabují kvůli další eskalaci napětí na Blízkém východě. Cena americké ropy překonala 85 USD za barel.
USA a Írán si poprvé přibližně po měsíci vyměnily údery. Naděje na brzké obnovení běžné dopravy přes Hormuzský průliv dále oslabila zpráva o zasažení tankeru minami. Dražší energie zvyšují inflační rizika a podle tržních sázek je nyní zářijové zvýšení sazeb Fedu pravděpodobnější než jejich ponechání beze změny. Rozhodující budou údaje z trhu práce a následná inflační data.
Nvidia (+0,4 %) zároveň investuje 3,5 mld. USD do tchajwanského výrobce čipů MediaTek.
Z růstu cen ropy těží akcie ropařů Chevron (+2,7 %) a Exxon Mobil (+2,4 %). Naopak PG&E (-19 %) a Edison International (-20 %) odepisují po návrhu kalifornské legislativy, která nepřenáší odpovědnost za škody způsobené požáry z veřejně obchodovaných utilit.
GameStop roste o 4,4 % díky předběžným tržbám nad odhady trhu. Eli Lilly (-1,6 %) koupí biotechnologickou společnost Merida Biosciences až za 2,88 mld. USD a SLB (+4,6 %) získá za 3,4 mld. USD výrobce technologií pro chlazení datových center Kelvion.
Index S&P 500 -0,41 % na 7680,52 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Energie +2,5 % Utility -1,6 % Informační technologie +0,1 % Komunikační služby -1,4 % Základní materiály -0,2 % Zdravotní péče -1,1 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Crowdstrike Holdings (CRWD) +5,2 % Edison International (EIX) -20 % SLB (SLB) +4,6 % PG&E Corp (PCG) -19 % CF Industries Holdings (CF) +4,6 % Take-Two Interactive Software (TTWO) -7,0 % Ulta Beauty (ULTA) +3,6 % Howmet Aerospace (HWM) -6,1 % LyondellBasell Industries (LYB) +3,6 % Aon (AON) -5,9 %
Zdroj: Bloomberg
During its fiscal 2027 second quarter (ended July 26), Nvidia (NVDA -4.58%) reported a year-over-year revenue gain of 106% to $96.2 billion. Diluted earnings per share soared 128% to $2.46. These two headline figures came in ahead of Wall Street estimates. Shares are up 8% since the announcement (as of Aug. 28).
Nvidia remains the dominant artificial intelligence (AI) enterprise. And the latest numbers support the claim that demand for its data center chips isn't softening. Investors that were bearish have lost out on big gains.
But history says that the month of September could be a down period for this AI stock.
Image source: The Motley Fool.
Past data doesn't support a huge gain in September September is historically a weak month for the S&P 500 index. Over the 10-year period from 2016 through 2025, the closely watched benchmark posted an average loss of 1.3% in September. This didn't prevent the index from posting a fantastic total return during that time.
Nvidia tracks similarly. Over the same period (2016 through 2025), the technology stock's price declined an average of 0.8%.
Investors should come away with no clear takeaway. It's impossible to predict how Nvidia shares will perform in September. The business continues to operate at full strength from a fundamental perspective. This momentum can lift the stock price.
However, inflation remains a problem for the economy. And there's still a chance that the Federal Reserve raises the Fed funds rate before the year ends. This could pressure the equity market's performance as investors adopt a downbeat view of the tighter monetary policy.
Set a five-year time horizon It's so easy for investors to get caught up in the short term. There is a constant flood of information. While paying attention to these things can make you feel very knowledgeable about the companies in your portfolio or on your watch list, it distracts from what really matters.
Spend less time thinking about what September will bring. Instead, focus your attention on the next five years. This is the correct time horizon to adopt before deciding whether to buy a particular stock.
Nvidia shares soared 901% in the past five years. Given that it's now a $5.5 trillion company, I don't believe it's realistic to expect a similar return over the next 10 years.
But that doesn't mean investors should completely disregard the stock. There are some very compelling bull-case arguments to look at.
Nvidia's growth continues to be exceptional. And sell-side analysts believe the top line will expand at a 58% yearly rate between fiscal 2026 and fiscal 2029.
This is one of the most profitable enterprises on Earth. A supply-and-demand imbalance, resulting in sustained pricing power, supported a 62% net profit margin in the second quarter.
After such a jaw-dropping performance, you might initially assume the current valuation is expensive. This is far from the truth, though. Investors can buy this "Magnificent Seven" stock at a forward price-to-earnings (P/E) ratio of 23.9. This is only a 14% premium to the S&P 500 index.
Premium Feature
Moneyball Superscore
94/100
Today's Change
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This setup makes Nvidia appear like a no-brainer buying opportunity. The financials are impressive. And the valuation is attractive.
But the best investors put in the effort to understand the risks. Any business that was registering the revenue growth and profitability that Nvidia was would likely command a valuation that's a significant premium to the benchmark index. The market must be worried about something.
I believe the chief risk relates to the durability of the AI infrastructure build-out. On the Q2 2027 earnings call, Chief Financial Officer Colette Kress mentioned that the five top hyperscalers will spend $1.3 trillion on capital expenditures in 2027.
These is an exciting forecast. However, there is a chance that this spending boom slows sooner than the bulls hope. A lot of capital is riding on AI delivering product and service innovation and new economic activity. If it fails to deliver on its promise, you can bet that money flowing to AI labs, hyperscalers, and the chip sellers will take a hit.
This risk should not be ignored even though it's still worth taking a chance on Nvidia shares right now.
I do not think Nvidia (NVDA -4.58%) is wildly overvalued right now, and that's after a day when the stock posted strong earnings and management issued a bullish forecast, sending the stock up 8.7%. I don't think it's overvalued because its current valuation multiple is near multiyear lows, while its earnings and AI dominance are still compounding at rates that make today's price look reasonable. By 2028, if management delivers anything close to management's current guidance, this stock will be a great buy now.
When I look at Nvidia, I start with the basic math. The stock trades around a mid-30s trailing price-to-earnings ratio and a low-20s forward price-to-earnings ratio, levels that are actually below its 10-year average and far under the 50-plus multiples it carried at earlier stages of the AI boom. On top of that, its price-to-earnings-to-growth (PEG) ratio, which compares the valuation to expected growth, sits near 0.5, a signal that the market is not aggressively overpaying for the growth analysts are modeling over the next few years.
In plain English, investors are paying a premium, but it is a smaller one than they used to pay for Nvidia, and it has come down even as the business has exploded.
Image source: Getty Images.
The scale of the current business This is not a story stock on a few billion dollars of revenue. In its most recent fiscal year, Nvidia generated over $250 billion in total revenue, up roughly 65% year over year, with data center GPUs now responsible for the overwhelming majority of the business. Independent estimates put data center and AI accelerator revenue at $190-plus billion, with that segment representing around 90% of total sales. At the same time, Nvidia still controls roughly three-quarters of global AI accelerator revenue, even after its share has fallen from a peak near 87% as AMD and hyperscaler custom chips start to nibble at the edges.
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What the next few years look like Nvidia's valuation will depend less on today's multiple than on whether it can deliver the growth investors expect through 2028.
Analysts see revenue reaching about $390 billion in 2027 and more than $550 billion in 2028, with annual sales growth of roughly 24% to 25%. Management's outlook is even stronger: about 70% growth in fiscal 2028, which could put revenue near $670 billion.
If Nvidia keeps its gross margin in the low-70% range, much of that added AI revenue could turn into profit and free cash flow. The AI accelerator market is expected to grow from more than $200 billion in 2026 to over $430 billion by 2035. Nvidia may lose some share as competitors gain ground, but its revenue can still rise sharply if overall spending continues to expand. In that case, the stock would not need a higher P/E multiple to support today's price. The bigger risks are execution, whether AI spending holds up, and whether Nvidia can maintain its lead as competition grows.
What could break this thesis? On top of this competition, if hyperscaler custom silicon gains share faster than expected, or if AI demand normalizes rather than compounding, the earnings path I am describing becomes much flatter, and today's valuation could start to look stretched. Regulatory pressure, export controls, or a major shift toward cheaper inference hardware could also dent margins and challenge the idea that 70% growth is sustainable beyond a year or two.
But given the data I have today, I see Nvidia as richly valued yet not absurdly priced -- and that's even after a strong day like Aug. 27. By 2028, I think the debate will be less about whether it was overvalued in 2026 and more about whether investors gave enough credit to the earnings power of a company that effectively became the default AI compute platform for the world.
In this video, I will cover my biggest concern heading into Nvidia's (NVDA -4.58%) earnings report and which companies stood to benefit or lose depending on the results. Watch the short video to learn more, consider subscribing, and click the special offer link below.
*Stock prices used were from the trading day of Aug. 25, 2026. The video was published on Aug. 25, 2026.
Neil Rozenbaum has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
After the close of trading on Aug. 26, Nvidia (NVDA -4.58%) reported a set of operating results for its fiscal 2027 second quarter (ended July 26, 2026) that blew away Wall Street's expectations, and the company also unexpectedly offered some very bullish forward revenue guidance for fiscal 2028. As a result, Nvidia's stock price soared by almost 9% the very next day.
There is a long list of reasons why Nvidia stock is still a buy, but there is also room for caution right now, particularly surrounding the deals that management is cutting with many of the company's biggest artificial intelligence (AI) customers. So, before investors buy the stock, here's a breakdown of the good news and the bad news.
Image source: Nvidia.
The good news: Rapid growth and an attractive valuation Nvidia supplies the world's best graphics processing units (GPUs) for data centers, which are the main chips used in AI training and inference workloads. The company's new Vera Rubin systems, which include Rubin GPUs, Vera central processors (CPUs), and a series of advanced networking components, provide up to 30 times more performance per megawatt than its previous Blackwell Ultra systems, highlighting the sheer pace of innovation.
Nvidia says Vera Rubin systems will also reduce inference token costs by a staggering 97% compared to Blackwell Ultra. Inference tokens are the text, images, or computer code generated by an AI model in response to a query, so these new chips will dramatically reduce the cost of deploying AI software. This might encourage more AI usage while making data center operators more profitable, which will only increase demand for Nvidia's chips.
Wall Street expected Nvidia to generate $92.2 billion in revenue during its fiscal 2027 second quarter, but the company blew that away by bringing in $96.2 billion, a whopping 106% increase from the year-ago period. The data center segment accounted for $89 billion of that total, and it grew at an even faster rate of 117%.
The global shortage of AI chips and components is giving Nvidia an unprecedented ability to dictate prices, which is also a massive tailwind for its bottom line. As a result, its adjusted (non-GAAP) earnings surged by 120% to $2.22 per share during the second quarter.
That brings me to Nvidia's valuation; the company has now delivered adjusted trailing 12-month earnings of $7.01 per share, placing its stock at a price-to-earnings (P/E) ratio of just 34.9. That is a steep discount to its 10-year average of 61.5, suggesting it might be undervalued right now.
Data by YCharts.
Moreover, Nvidia just told investors to expect revenue growth of at least 70% in fiscal 2028. The company never issues guidance a year in advance, so this caught Wall Street's attention in the best possible way.
The bad news: Concerning circular financing deals The numbers can vary based on location, but building a one-gigawatt data center can cost around $38 billion, with the bulk of that money going toward GPUs and components. Nvidia says the top five hyperscalers, which include the likes of Microsoft and Amazon, will spend a combined $800 billion on AI infrastructure this year, and then a further $1.3 trillion next year. But smaller AI labs are struggling to compete because they simply don't have the same financial resources.
As a result, Nvidia is helping them achieve their goals by investing directly into their companies, and also by partially financing their purchases of GPUs and other hardware. These deals are often called "circular" because Nvidia is basically funding the sale of its own products.
According to the latest guidance from chief financial officer Colette Kress, around 25% of Nvidia's sales in fiscal 2028 will come from customers it has financed in some way. Since the company's revenue could top $670 billion next year, around $168 billion could be funded by its own balance sheet. To put it another way, a huge chunk of Nvidia's forecasted growth is expected to come from customers who don't necessarily have the money to pay for its products up front.
Nvidia has invested in practically every major AI lab, including OpenAI, Anthropic, xAI, Mistral AI, and Perplexity. But these early-stage companies continue to lose truckloads of money while they race to build the best models and attract the most customers, so although Nvidia says its circular financing agreements present a low risk, I think its high degree of ongoing exposure could get really uncomfortable if the AI boom hits a speed bump. That will be especially true if similar deals account for even more of its sales beyond fiscal 2028.
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The verdict Based on its attractive valuation and the company's rapid growth, Nvidia stock could be a great addition to a diversified portfolio, particularly one that already has a low level of exposure to AI stocks.
Nvidia is likely to remain the undisputed leader in AI hardware for years to come, but it's important for investors to pay close attention to further developments in circular financing. If these deals become a much bigger part of the company's revenue in the future, it might be a good idea for investors to trim their position to reduce risk.
Nvidia (NVDA -4.58%) has steadily delivered one thing in particular to investors quarter after quarter: Mind-blowing earnings growth that's reached record levels well into the billions of dollars. This is thanks to the company's dominance in the high-growth market of artificial intelligence (AI) chips and its expansion into related products and services. In fact, Nvidia has built an AI empire, and in the latest three-month period, this translated into $96 billion in revenue and $59 billion in profit.
In the earliest stages of the AI boom, this growth resulted in stock price gains, with the shares climbing 800% over the past five years. But in recent times, Nvidia stock has faltered here and there. For example, in the first quarter of the year, it slipped 6.4%, and its year-to-date gain of 16% isn't huge for such a high-growth company.
So, it's perfectly logical to wonder where Nvidia stock will be after the company's latest explosive earnings report. History offers us some answers.
Image source: The Motley Fool.
The Nvidia story so farBefore considering performance ahead, though, let's take a look back at Nvidia's AI story. This tech giant has always been an expert in graphics processing units (GPUs) -- but these powerful chips initially were designed for the gaming market. As it became clear that they could serve many other areas, Nvidia developed the parallel computing platform CUDA to make that happen. And about a decade ago, predicting the GPU's potential in the AI market, Nvidia focused on developing these chips for that particular use.
As they say, the rest is history. Nvidia's early entry into this market, along with its commitment to ongoing innovation, has kept it ahead and allowed it to pursue additional opportunities in the space and beyond. For example, last year the company announced a partnership with Nokia for the development of AI-native mobile networks. And Nvidia has brought its technology to hybrid quantum-classical computing.
Some of these moves should generate growth in the future, but earlier decisions have already built an impressive revenue machine.
While Nvidia's stock has climbed over the years, in recent months, it's faced headwinds. Investors have worried about rising competition in the chip market as well as the pace of AI spending, and these concerns have weighed on stock performance. Even explosive earnings reports haven't resulted in major gains in the days to follow. For example, after an 8% increase in the trading session after Nvidia's latest report, the stock slipped the next day.
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Nvidia's historical trendNow, let's consider our question: Where will Nvidia stock be six months after the latest report? History offers Nvidia-watchers and shareholders a clear answer. After the past 12 quarterly earnings reports, Nvidia stock climbed nine times in the six months that followed. And eight of those times, gains have been in the double digits. (This excludes the May 2026 earnings report since six months haven't yet passed.)
So, if history is right, Nvidia could deliver a double-digit increase over the coming six months, which clearly is fantastic news for investors.
Of course, while history may offer us an idea of what's generally happened in the past, it isn't always right. Proof of this is that Nvidia has occasionally fallen over the six months following an earnings report.
But here's why there's reason to be optimistic, no matter what direction the stock takes in the months to come: Nvidia's earnings performance and market leadership, as well as the strength of overall demand in the AI market, suggest that the company is likely to deliver impressive growth well into the future. Meanwhile, trading at only 23x forward earnings estimates, Nvidia stock is very reasonably priced, meaning it may have plenty of room to run.
All of this should translate into fantastic stock performance over the long term -- and if Nvidia follows the historical pattern, we may get a taste of this over the coming six months.
Nvidia (NASDAQ: NVDA) insiders have collectively sold more than $664 million worth of stock in 2026, with one executive accounting for the vast majority of those transactions.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of NVDW either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
The S&P 500 keeps setting records, but strip away two stocks and the picture underneath looks nothing like a healthy bull market. What Bespoke Investment Group's latest earnings data reveals about who is actually driving this rally should change how…
The stock market’s march to new highs has made the bull market look healthy. Earnings have rolled in, the S&P 500 has continued climbing, and investors can point to a rising index as evidence that corporate America is doing just fine.
The numbers beneath the surface, however, tell a different story.
Since second-quarter earnings season began on July 13, the S&P 500 has added $1.75 trillion in market value, according to Bespoke Investment Group, but nearly 80% of that gain came from the technology sector — and, more remarkably, virtually all of the sector’s advance came from just two companies.
Microsoft (NASDAQ:MSFT | MSFT Price Prediction) and Nvidia (NASDAQ:NVDA) added a combined $1.42 trillion in market capitalization, while the other 71 stocks in the technology sector lost a combined $22.3 billion.
That’s not market breadth. That’s two companies carrying an awful lot of weight.
Two Stocks Are Doing The Heavy Lifting Bespoke Investment Group’s data shows just how lopsided this earnings season has become. The technology sector added $1.392 trillion in market value, accounting for 79% of the S&P 500’s $1.75 trillion gain. Yet Microsoft and Nvidia alone contributed $1.42 trillion.
In other words, without those two stocks, the rest of the technology sector would have been underwater.
Here’s how the S&P 500’s sectors have changed since July 13:
Sector Change in Market Cap Technology +$1.392 trillion Health Care +$345.2 billion Financials +$192.7 billion Energy +$174.7 billion Communication Services -$299.6 billion Utilities -$88.5 billion Industrials -$67.3 billion Surprisingly, the index can continue hitting new highs even while several major sectors are losing hundreds of billions of dollars in value. That’s the mathematical quirk of a market-cap-weighted index: the biggest companies have the biggest influence.
Microsoft and Nvidia aren’t merely participants in the S&P 500. At the moment, they’re increasingly determining where it goes.
The S&P 500 looks strong, but a massive hidden weakness lurks. Two stocks are single-handedly carrying the entire market's weight. A Rising Index Can Hide A Weak Market This concentration creates a false sense of security. An investor looking only at the S&P 500 sees a market that is rising. That suggests broad participation, improving corporate fundamentals, and widespread investor confidence. But Bespoke’s data shows that the gains since earnings season began have been extraordinarily concentrated.
Communication Services alone lost $299.6 billion in market value — more than the gains posted by either Financials or Energy. Utilities declined by $88.5 billion, while Industrials lost $67.3 billion. Those aren’t signs that every corner of the market is moving higher.
Owning an S&P 500 index fund is supposed to provide diversification across 500 companies and 11 sectors. Investors still get that diversification structurally, but the performance of the portfolio can increasingly hinge on whether a handful of mega-cap stocks continue rising. That works fine when those companies deliver, but it becomes a problem when expectations change.
If Microsoft or Nvidia stumble, their enormous weight means their declines can pull the index lower even if hundreds of smaller companies are performing well. Conversely, their gains can mask weakness elsewhere — exactly what Bespoke’s latest data shows.
Concentration Raises The Stakes For Investors Granted, Microsoft and Nvidia have earned their market leadership. Both sit at the center of the AI infrastructure buildout, and investors have rewarded them for the revenue and profit opportunities the spending boom created.
The risk isn’t that these are bad businesses; it’s that the market is increasingly dependent on them remaining nearly flawless. When two stocks can add $1.42 trillion in market value while the other 71 companies in their sector collectively lose $22.3 billion, expectations are becoming concentrated alongside market capitalization — leaving less room for disappointment.
Key Takeaway In short, the S&P 500’s new highs should not automatically be mistaken for broad market strength. The data shows 79% of the index’s gain since July 13 came from technology, with Microsoft and Nvidia adding the vast majority.
Smart investors don’t need to abandon the S&P 500. But they should recognize what they own. Check how much of your portfolio depends on the same handful of AI leaders. Diversification isn’t just about owning more stocks — it’s about making sure two of them aren’t quietly determining the fate of everything else.
Contact [email protected] for any questions or corrections.
