<div id="readability-page-1"><p><strong>Nvidia</strong> <span>(NVDA<span> 1.69%</span>)</span>, the world's largest producer of discrete graphics processing units (GPUs), saw its stock surge 25,250% over the past 10 years as the <strong>S&amp;P 500</strong> advanced less than 180%. From fiscal 2015 to fiscal 2025 (which ended this January), its revenue rose at a compound annual growth rate (CAGR) of 39% as its net income increased at a CAGR of 61%.</p> <p>That explosive growth was initially fueled by its brisk sales of gaming GPUs, which were also used to mine certain cryptocurrencies. But over the past few years, its expansion was primarily driven by its soaring shipments of data center GPUs for the artificial intelligence (AI) market.</p> <div><p><img src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MjAwNDIvaW52ZXN0b3ItaW4tZnJvbnQtb2YtYS10cmFkaW5nLXNjcmVlbi5qcGcmdz03MDA?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="700" height="466" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MjAwNDIvaW52ZXN0b3ItaW4tZnJvbnQtb2YtYS10cmFkaW5nLXNjcmVlbi5qcGcmdz03MDA"/></p><p>Image source: Getty Images.</p> </div> <p>Unlike central processing units (CPUs), which process single pieces of data at a time, GPUs process a broad range of integers and floating numbers simultaneously. That advantage makes them better suited than stand-alone CPUs for processing complex AI tasks, so the rapid expansion of the AI market generated explosive tailwinds for its sales of data center GPUs.</p> <p>But since the start of 2025, Nvidia's stock rose less than 4% as the S&amp;P 500 stayed nearly flat. The Trump administration's unpredictable tariffs, tighter curbs on exported chips, and the delays for its latest Blackwell chips all caused Nvidia to lose its luster. However, I believe Nvidia's stock can stay ahead of the S&amp;P 500 this year for five simple reasons.</p> <h2>1. It still dominates the booming AI chip market</h2> <p>Nvidia controlled 82% of the discrete GPU market at the end of 2024, according to JPR. Its closest competitor, <strong>AMD</strong>, held a 17% share, while <strong>Intel</strong> -- which returned to the discrete GPU market in 2022 -- controlled just 1% of the market. Nvidia also controls about 98% of the data center GPU market, according to TechInsights. The remaining 2% is split between AMD and Intel. Nvidia's dominance of that booming market, which is supported by the widespread usage of its older A100 chips and current-gen H100 and H200 chips, makes it tough for its competitors to gain a meaningful foothold.</p> <p>The global AI market could still expand at a CAGR of 31% from 2025 to 2032, according to Markets and Markets. If Nvidia merely matches that growth rate, its annual revenue would surge from $130.5 billion in fiscal 2025 to $1.31 trillion by fiscal 2032. So assuming it maintains roughly the same valuations, its stock still has a clear path toward delivering a ten-bagger gain over the next seven years.</p>  <h2>2. Its ecosystem is sticky</h2> <p>Nvidia reinforces its dominance through its proprietary Compute Unified Device Architecture (CUDA) programming platform. When software developers write their AI applications in a parallel code (such as C++ or Python) on CUDA, those applications become optimized for Nvidia's GPUs but can only be executed on its chips.</p> <p>If a developer wants to run that same application on an AMD or Intel GPU, it needs to be rewritten in other frameworks. In addition, most libraries, frameworks, and deep learning models are optimized for CUDA instead of other platforms. That stickiness should keep Nvidia well ahead of its competitors for the foreseeable future.</p> <h2>3. It can keep growing without China</h2> <p>China accounted for just 12.5% of Nvidia's revenue in fiscal 2025, compared to 16.9% in fiscal 2024 and 21.5% in fiscal 2023. That decline was mainly caused by America's tighter export curbs on its high-end data center GPU shipments to China.</p> <p>Nvidia tried to counter those challenges by selling less powerful, modified versions of its flagship GPUs. However, those versions (like the scaled-back H20 variant of its H100 and H200 chips) were also recently added to the growing list of banned U.S. chip shipments to China.</p> <p>That sounds like grim news for Nvidia, but it can still easily offset its declining revenues in China with its growth in its other, less controversial markets. That's why its revenue grew at a CAGR of 120% from fiscal 2023 to fiscal 2025, even as the export curbs choked its Chinese business.</p> <h2>4. Its other smaller businesses are growing</h2> <p>Nvidia generated 89% of its revenue from its data center chips in the first quarter of fiscal 2026. However, its smaller gaming, professional visualization, automotive, and OEM segments also grew year over year alongside its core growth engine.</p> <p>Its gaming business benefited from its rollout of its new RTX Super GPUs. Its professional visualization segment grew as it launched more design-oriented chips and expanded its Omniverse platform for digital projects, and its automotive chip sales improved as more Chinese automakers integrated its Drive platform into their electric vehicles. These oft-overlooked businesses should continue expanding in the shadow of its massive AI data center business.</p> <h2>5. It still looks reasonably valued</h2> <p>From fiscal 2025 to fiscal 2028, analysts expect Nvidia's revenue and earnings per share to grow at CAGRs of 31% and 29%, respectively. Yet its stock still looks reasonably valued at 34 times this year's earnings. So once investors realize that its near-term issues won't affect its long-term growth, Nvidia's stock should outperform the market for the rest of the year.</p>                                                                            </div>

NVDA

<p>Nvidia (NVDA) has outperformed the S&P 500 over the past decade, with a stock surge of 25,250%. Despite recent challenges, including tariffs and export curbs, Nvidia is expected to continue leading the AI chip market, controlling 82% of the discrete GPU market. Its proprietary CUDA platform enhances its competitive edge, while growth in other markets offsets declines in China. Analysts predict Nvidia's revenue could reach $1.31 trillion by fiscal 2032, indicating strong potential for stock growth.</p>

- Nvidia's stock surged 25,250% over the past decade, driven by gaming GPUs and later by data center GPUs for the AI market, with revenue growing at a CAGR of 39%.  
- Despite recent challenges, including tariffs and export curbs, Nvidia maintains a dominant 82% share of the discrete GPU market and 98% of the data center GPU market, with potential revenue growth from $130.5 billion to $1.31 trillion by fiscal 2032.  
- Analysts expect Nvidia's revenue and earnings per share to grow at CAGRs of 31% and 29% from fiscal 2025 to 2028, suggesting the stock remains reasonably valued and poised for long-term growth.  

Prediction: Nvidia Will Beat the Market. Here's Why