<div id="readability-page-1">The accelerating adoption of artificial intelligence (AI) was largely credited with sparking the current bull market that has been running riot for more than two years. Over the past few months, however, investors have become increasingly concerned that the impact of tariffs and the potential for slowing adoption could stymie the rally that has lifted many AI stocks to new heights. Take Nvidia (NVDA -0.02%) for example. In the company's fiscal 2025 fourth quarter (ended Jan. 26), Nvidia delivered revenue of $39.3 billion, which soared 78% year over year, while its earnings per share (EPS) of $0.89 soared 82%. While results of that magnitude would be enough to send most stocks soaring, Nvidia turned south and is down roughly 14% since the report was released. In the ensuing months, investors have been seeking assurances that AI adoption remains high. Enter Advanced Micro Devices (AMD -1.61%) CEO Lisa Su, who just delivered incredible news for Nvidia investors. <div><img src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MTc0MzEvYS1wZXJzb24tdGFraW5nLW5vdGVzLWFuZC1zbWlsaW5nLWxvb2tpbmctYXQtc3RvY2stY2hhcnRzLW9uLWEtY29tcHV0ZXIuanBnJnc9NzAw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="700" height="369" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MTc0MzEvYS1wZXJzb24tdGFraW5nLW5vdGVzLWFuZC1zbWlsaW5nLWxvb2tpbmctYXQtc3RvY2stY2hhcnRzLW9uLWEtY29tcHV0ZXIuanBnJnc9NzAw"/>Image source: Getty Images. </div> <h2>The death of AI has been greatly exaggerated</h2> AMD reported its first-quarter results after market close on Tuesday, and investors were pleasantly surprised. The chipmaker generated record revenue of $7.4 billion, up 36% year over year, while its adjusted EPS of $0.96 jumped 55%. To put those results in context, analysts' consensus estimates were calling for revenue of $7.12 billion and EPS of $0.93, so AMD cleared both hurdles with room to spare. The biggest contributor to the results was strength from AMD's data center segment, as revenue of $3.7 billion jumped 57% year over year. The client and gaming segment delivered revenue of $2.9 billion, up 28%. While client revenue of $2.3 billion rallied 68%, gaming revenue of $647 million remained in a secular slump, down 30%. The company also boasted an expanding gross margin of 50%, up 300 basis points from 47% in the prior year quarter, thanks to higher data center revenue and a favorable product mix. AMD also provided a robust outlook for the second quarter, forecasting revenue of $7.4 billion at the midpoint of its guidance, well ahead of the $7.24 billion predicted by analysts. Of the results, CEO Lisa Su said (emphasis mine), &#34;We delivered an outstanding start to 2025 as year-over-year growth accelerated for the fourth consecutive quarter, driven by strength in our core businesses and expanding data center and AI momentum.&#34; That news bodes well for Nvidia. <h2>Broader implications</h2> Beyond the good news for AMD investors, the results have broader implications across the tech space. Over the past couple of years, the pace at which generative AI has evolved has been dizzying, adoption remains high, and the availability of the technology has never been greater. Recent commentary from every corner of big tech suggests the buildout of data centers needed to support the technology continues at a frantic pace. So, what does this have to do with Nvidia? The company is the leading provider of graphics processing units (GPUs) that speed AI through the ether. While estimates vary, Nvidia controlled as much as 98% of the data center GPU market over the past couple of years. While the competition has increased, the market continues to grow, making Nvidia the odds-on favorite to profit from this once-in-a-generation paradigm shift. The popular narrative in recent months has been that the adoption of AI is slowing, despite evidence to the contrary. Most experts suggest that AI will generate trillions of dollars over the coming five to 10 years, but estimates vary wildly. The generative AI market is expected to be worth $1.3 trillion by 2032, according to a report by Bloomberg Intelligence. McKinsey &amp; Company is even more bullish, calculating that generative AI could add the equivalent of between $2.6 trillion and $4.4 trillion to the global economy over the coming decade. Not to be outdone, Big Four accounting firm PricewaterhouseCoopers (PwC) values the potential contribution of generative AI to the global economy at $15.7 trillion by 2030. The twin takeaways from this exercise are that no one knows for sure how big generative AI will ultimately be, and the market opportunity is significant. Fears about the slowing adoption of AI, the uncertainty wrought by global tariffs, and a moratorium on sales to China have weighed heavily on Nvidia, with the stock down 16% (as of this writing) since the start of 2025. The falling stock price, combined with the company's accelerating profits, creates a compelling opportunity for investors, as Nvidia is selling for just 26 times forward earnings, an attractive price for a company at the heart of the AI revolution. </div>

NVDA

Nvidia's recent performance has raised concerns among investors, despite a strong fiscal Q4 2025 with $39.3 billion in revenue, up 78% year-over-year. AMD's CEO Lisa Su announced impressive Q1 results, with record revenue of $7.4 billion, indicating robust AI adoption. This positive outlook for AMD suggests continued growth in the AI sector, benefiting Nvidia, which dominates the GPU market. Despite fears of slowing AI adoption and global tariffs, Nvidia's stock presents a compelling investment opportunity at 26 times forward earnings, as the generative AI market is projected to be worth trillions in the coming years.

- The article discusses the impact of artificial intelligence (AI) on the current bull market, highlighting concerns over tariffs and slowing adoption affecting AI stocks like Nvidia.  
- Nvidia reported significant revenue growth but saw its stock decline, while AMD's strong quarterly results and optimistic outlook suggest continued momentum in AI adoption.  
- The generative AI market is projected to be worth up to $15.7 trillion by 2030, indicating substantial growth potential despite current market uncertainties.

Nvidia Investors Just Got Incredible News From AMD CEO Lisa Su