Nasdaq jumps as Nvidia ignites global rally

At first glance, the story following Nvidia’s (NVDA) latest eye-popping earnings day is the financials themselves.

To see this kind of growth at Nvidia’s scale is crazy:

• Total sales: +265% vs last year

• Data Center: +409% vs last year

• Visualization: +105% vs last year

The company’s guidance was equally impressive.

But once the shock and awe wears off, I think you will see the Street dig in on Nvidia and really try to determine how this company is growing in 2025 and 2026. There has been some chatter on the Street this morning that Nvidia may start to see a sharp growth slowdown next year as Big Tech companies such as Microsoft rein in their AI spending after two heavy years of investment.

To that emerging debate, I offer up this key point from Stifel analyst Ruben Roy.

Roy didn’t shoot down the notion of Nvidia’s growth miracle cooling next year but contended they won’t fall off a cliff because of the work the company is doing to diversify its revenue base.

Says Roy:

“As questions regarding the sustainability of Nvidia’s growth increase, we found management commentary on revenue diversification notable. In addition to continued growth of Networking and Software, Nvidia’s overall Data Center revenue is increasingly diversifying across industries and regions, including a growing contribution from demand related to sovereign AI deployments. This diversification, in our view, is likely to continue as AI-related ROI for end users accelerates.

“Nvidia continues to believe that the migration from general purpose compute to accelerated compute represents a $1 trillion opportunity, longer term. As the AI Factory concept materializes, management believes that another $1 trillion opportunity could follow.

Back to marveling at Nvidia’s numbers… for now.