90 Billion Reasons Why Buying Nvidia Stock Is a No-Brainer Right Now

Any doubts about Nvidia‘s (NASDAQ: NVDA) ability to sustain its red-hot stock market momentum were put to rest last week following the release of the company’s fourth-quarter fiscal 2024 results (for the quarter ending Jan. 28). The semiconductor giant not only crushed Wall Street’s expectations handsomely, but it also guided strongly for the current quarter, suggesting that its artificial intelligence (AI)-fueled growth is here to stay.

Not surprisingly, Nvidia stock soared impressively following its earnings release. Additionally, analysts have started raising their growth forecasts for the current and the next two fiscal years, suggesting that its outstanding growth is here to stay.

However, a key statement from Nvidia CFO Colette Kress on the company’s earnings conference call suggests that it can sustain its terrific growth for a much longer period: “We estimate in the past year approximately 40% of data center revenue was for AI inference.”

Let’s dive into the details.

AI inferencing could help Nvidia maintain its supremacy in this lucrative market

Nvidia’s graphics processing units (GPUs) shot into the limelight once it was evident that they are playing a mission-critical role in training large language models (LLMs), which form the backbone of popular generative AI applications such as ChatGPT. Multiple cloud service providers have lined up to get their hands on Nvidia’s GPUs to train their AI models and bring generative AI services to the market. As a result, Nvidia controls a whopping 90% share of the AI training chip market.

As it turns out, the demand for Nvidia’s flagship H100 AI GPU is so strong that customers are willing to wait between 36 and 52 weeks to get their hands on this piece of hardware. Nvidia is shoring up its supply capacity to meet that solid demand, and that explains why the company is expected to keep growing at a terrific pace and more than double its revenue by fiscal 2027 as compared to…