Nvidia’s (NASDAQ: NVDA) recent fourth-quarter fiscal 2024 results have solidified its position as a powerhouse in the semiconductor industry. The company not only exceeded Wall Street’s expectations but also provided strong guidance for the current quarter, indicating that its growth fueled by artificial intelligence (AI) is sustainable.
Following the earnings release, Nvidia’s stock soared, and analysts have raised their growth forecasts for the current and upcoming fiscal years. CFO Colette Kress’s statement on the earnings call further reinforced the company’s potential for long-term growth, highlighting that 40% of data center revenue came from AI inference.
Nvidia’s dominance in the AI chip market, particularly in AI training and inference, positions it as a key player in the industry. The demand for its flagship H100 AI GPU is high, with customers willing to wait several weeks to acquire the hardware. With projections indicating a doubling of revenue by fiscal 2027, Nvidia’s future looks promising.
The AI inference market is expected to drive significant revenue growth, with estimates suggesting a jump from $16 billion in 2023 to nearly $91 billion by 2030. Nvidia’s current stronghold in this market, coupled with potential moves into custom chips, could further solidify its position and drive future growth.
Despite its recent surge, Nvidia remains an attractive investment opportunity, with a forward earnings multiple lower than its historical average and a PEG ratio indicating undervaluation. Investors looking to capitalize on the company’s growth prospects may find Nvidia stock a compelling buy.
In conclusion, Nvidia’s strong performance in the AI chip market, coupled with its strategic moves to capitalize on future opportunities, make it a standout investment choice. As the company continues to innovate and expand its presence in the AI space, investors may see significant returns in the years to come.
