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Globe and Mail
05-05-2025
- Business
- Globe and Mail
Meta, Microsoft, Alphabet, and Amazon Just Delivered Incredible News for Nvidia Stock Investors
Like much of the stock market, Nvidia (NASDAQ: NVDA) has experienced significant volatility in 2025. Even after recovering some of its losses, the stock remains down 15% year to date. Investors are concerned that President Donald Trump's tariffs could reduce demand for the company's data center chips, which are the best in the industry for developing artificial intelligence (AI) applications. Although semiconductors are exempt from the most aggressive tariff policies, many of Nvidia's customers still face increased costs and potential sales declines, which could force them to reduce their capital expenditures (capex). Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Meta Platforms (NASDAQ: META), Microsoft (NASDAQ: MSFT), Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL), and Amazon (NASDAQ: AMZN) are four of the biggest buyers of Nvidia's AI chips, and they just gave Nvidia investors a positive update on their planned AI spending for this year. Nvidia's chips are the gold standard in AI Nvidia's H100 graphics processing unit (GPU) was the industry's dominant AI data center chip throughout 2023 and for most of 2024. It was based on the company's Hopper architecture, which has been superseded by the higher-performing Blackwell and Blackwell Ultra architectures. In fact, the new Blackwell Ultra GB300 GPU can perform AI inference up to 50 times faster than the H100 in specific configurations, which is important for developers of next-generation "reasoning" models. Traditional large language models (LLMs) deliver one-shot responses, providing users with fast and convenient access to information, but they often make mistakes. Reasoning models spend more time "thinking" in the background to clear up as many errors as possible before generating a response. This means they make better use of the data they already have, which reduces pre-training workloads (endlessly feeding more data into models to make them "smarter"). But since reasoning models use up more tokens (words, symbols, and punctuation) during the thinking process and are slower to generate responses, Nvidia CEO Jensen Huang says they need up to 100 times more computing power than traditional models to maintain a convenient user experience. Blackwell Ultra chips (which will ship to customers in the second half of 2025) are a step in the right direction, but developers are already eyeing Nvidia's next-generation Rubin GPUs, which are expected to deliver a further 3.3 times more compute performance. Rubin GPUs will pave the way for the most powerful reasoning models to date, and they are slated for release in 2026. Simply put, Nvidia is investing heavily in innovation to continue driving the AI industry industry forward for the long term, which is why investors are so anxious for proof that demand is holding up. Meta, Microsoft, Alphabet, and Amazon delivered good news for Nvidia investors Nvidia is an American company, but the majority of its chips are fabricated offshore by Taiwan Semiconductor Manufacturing, so they are technically imported products. However, Trump exempted semiconductors from his "Liberation Day" tariffs on imports, as he understands the importance of keeping the U.S. at the forefront of AI technology. The bigger concern is the effect of tariffs on Nvidia's customers. They are spending tens of billions of dollars per year on AI chips and data center infrastructure, so any slowdown in their core operations could force them to pull back. Tariffs apply to physical goods, so a company like Amazon will take a hit because it draws part of its revenue from its e-commerce platform, which imports retail products from other countries. However, Amazon's cloud services platform, digital advertising business, and streaming segment aren't directly subjected to tariffs because they offer digital products and services. Other Nvidia customers like Meta, Microsoft, and Alphabet also primarily sell digital products and services, so they could weather the global trade tensions better than most companies. As a result, they each delivered reassuring news for Nvidia investors when they reported their financial results for the first quarter (ended March 31): Meta raised its 2025 capex forecast range to $64 billion to $72 billion (from $60 billion to $65 billion previously). Microsoft held its capex forecast steady, so it's on track to spend around $80 billion during its fiscal 2025 (ending June 30). Alphabet didn't change its capex forecast with $75 billion in spending planned for 2025. Amazon also left its capex forecast unchanged, so it's still likely to spend around $105 billion this year. Nvidia stock looks like a bargain right now The dip in Nvidia stock has created a fantastic buying opportunity for investors too. The stock currently trades at a price-to-earnings (P/E) ratio of 39, which is a significant discount to its 10-year average and median, both of which are above 50. Data by YCharts. Nvidia generated $115.2 billion in data center revenue during its fiscal 2025 (ended Jan. 26), which was an eye-popping 142% increase from the prior year. But Huang predicts that data center spending will top $1 trillion annually by 2028 as reasoning models demand even more computing power, so the company still has a long potential growth runway. Data center operators like Meta, Microsoft, Alphabet, and Amazon typically plan their infrastructure spending years in advance, even if they only offer guidance for the coming 12 months. Therefore, they might be willing to look past any short-term slowdown in the economy from the tariffs and global trade tensions. That's likely why they haven't reduced their capex forecasts. Plus, demand for Nvidia's chips is outstripping supply, so companies can't afford to cancel orders because they would risk falling behind in the AI race. As a result, Nvidia stock looks like a great buy at the current price, especially for investors who are willing to stay the course until 2028 and beyond. Don't miss this second chance at a potentially lucrative opportunity Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $296,928!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $38,933!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $623,685!* Right now, we're issuing 'Double Down' alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon. See the 3 stocks » *Stock Advisor returns as of May 5, 2025 Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, Microsoft, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
Yahoo
02-05-2025
- Business
- Yahoo
Jensen Huang Predicts Annual Data Center Spending Will Hit $1 Trillion by 2028. Here's the Ultimate Semiconductor ETF to Buy Right Now.
Artificial intelligence (AI) could be the most valuable financial opportunity in the history of the semiconductor industry. Nvidia CEO Jensen Huang thinks data center spending will top $1 trillion per year by 2028, purely because of AI. The iShares Semiconductor ETF holds 30 of the highest-quality stocks that could benefit from the AI spending boom. Semiconductors are the beating heart of the artificial intelligence (AI) revolution. Graphics processing units (GPUs), AI accelerators, high-bandwidth memory, and networking equipment fill modern data centers, delivering the computing capacity developers need to create advanced AI software. Data center spending is growing each year, and Nvidia (NASDAQ: NVDA) CEO Jensen Huang predicts it will top $1 trillion annually by 2028 as tech giants and start-ups alike battle for AI supremacy. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » The iShares Semiconductor ETF (NASDAQ: SOXX) holds 30 different stocks that could be massive winners if Huang is right. It's currently down 16% in 2025 amid the broader market sell off that was triggered by simmering global trade tensions, but here's why investors might want to look past the short-term noise and buy it now. The iShares Semiconductor ETF was established in 2001, so it has helped investors navigate numerous hardware booms driven by technologies like the internet, the smartphone, enterprise software, and cloud computing. Most suppliers of chips and components are now focusing on AI, because that's where the demand has shifted. The top five holdings in the iShares ETF feature some of the biggest hardware names in the AI space, and they represent 37.9% of the total value of the portfolio: Stock iShares ETF Portfolio Weighting 1. Broadcom 8.69% 2. Nvidia 8.01% 3. Texas Instruments 7.49% 4. Advanced Micro Devices 6.97% 5. Qualcomm 6.81% Data source: iShares. Portfolio weightings are accurate as of April 25, 2025, and are subject to change. Broadcom makes AI accelerators for three unnamed hyperscale customers which can be customized to suit their needs, so they are a great alternative to traditional GPUs from suppliers like Nvidia. Broadcom thinks it could capture up to $90 billion in annual revenue from those three customers alone by fiscal 2027. Beyond chips, the company sells data center switches and networking equipment to facilitate rapid processing speeds, which is also critical for AI developers. Despite growing competitive threats, Nvidia's data center GPUs are still the benchmark in AI hardware. The company recently unveiled its Blackwell Ultra GB300 GPU, which delivers a 50-fold performance bump in certain configurations compared to its old Hopper-based H100. The Blackwell Ultra architecture was designed for "reasoning" AI models, which require up to 100 times more computing power than traditional large language models, according to Jensen Huang. Advanced Micro Devices (AMD) is an emerging powerhouse in the data center space. It has its own lineup of AI GPUs, and its latest MI355X is built on a new architecture called CDNA (Compute DNA) 4, which was designed to rival Nvidia's original Blackwell architecture. However, those chips won't ship to customers in high volumes until midyear, so Nvidia still has a significant first-mover advantage. But it's not all about the data center, because AMD is also a top supplier of AI chips for personal computers, which could be a big growth market in the future. Outside of the above stocks, the iShares ETF holds a number of other prominent AI hardware names. They include Micron Technology, which supplies memory and storage chips, and Taiwan Semiconductor Manufacturing, which fabricates most of the GPUs designed by Nvidia and AMD. President Donald Trump imposed a broad 10% tariff on all imported goods from America's trading partners in early April, in addition to a series of higher "reciprocal tariffs" on specific countries. However, semiconductors are exempt from the reciprocal levies, mainly because leading the AI race is a matter of national security for the U.S. Nevertheless, trade tensions could drive an economic slowdown, which might affect demand for chips in the short term as data center operators reevaluate their budgets. But here's the good news: The iShares Semiconductor ETF has delivered a compound annual return of 10.4% since it was established in 2001, beating the average annual gain of 7.8% in the S&P 500 over the same period. Plus, the ETF has delivered an accelerated annual return of 20.9% over the last 10 years specifically, thanks to the broad adoption of technologies like enterprise software, cloud computing, and now AI. The point is the iShares ETF has weathered a number of economic shocks during its 24-year history -- including President Trump's last tariff saga in 2018 -- while still delivering strong returns. If data center spending does grow to an annual rate of $1 trillion by 2028 as Jensen Huang predicts, then those returns are likely to continue (if not accelerate further). As a result, this might be a great time to buy the iShares ETF, especially considering its year-to-date dip of 16%. Before you buy stock in iShares Trust - iShares Semiconductor ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and iShares Trust - iShares Semiconductor ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $607,048!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $668,193!* Now, it's worth noting Stock Advisor's total average return is 880% — a market-crushing outperformance compared to 161% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 28, 2025 Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Nvidia, Qualcomm, Taiwan Semiconductor Manufacturing, Texas Instruments, and iShares Trust-iShares Semiconductor ETF. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy. Jensen Huang Predicts Annual Data Center Spending Will Hit $1 Trillion by 2028. Here's the Ultimate Semiconductor ETF to Buy Right Now. was originally published by The Motley Fool
Globe and Mail
01-05-2025
- Business
- Globe and Mail
Jensen Huang Predicts Annual Data Center Spending Will Hit $1 Trillion by 2028. Here's the Ultimate Semiconductor ETF to Buy Right Now.
Semiconductors are the beating heart of the artificial intelligence (AI) revolution. Graphics processing units (GPUs), AI accelerators, high-bandwidth memory, and networking equipment fill modern data centers, delivering the computing capacity developers need to create advanced AI software. Data center spending is growing each year, and Nvidia (NASDAQ: NVDA) CEO Jensen Huang predicts it will top $1 trillion annually by 2028 as tech giants and start-ups alike battle for AI supremacy. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More » The iShares Semiconductor ETF (NASDAQ: SOXX) holds 30 different stocks that could be massive winners if Huang is right. It's currently down 16% in 2025 amid the broader market sell off that was triggered by simmering global trade tensions, but here's why investors might want to look past the short-term noise and buy it now. Every top semiconductor stock packed into one ETF The iShares Semiconductor ETF was established in 2001, so it has helped investors navigate numerous hardware booms driven by technologies like the internet, the smartphone, enterprise software, and cloud computing. Most suppliers of chips and components are now focusing on AI, because that's where the demand has shifted. The top five holdings in the iShares ETF feature some of the biggest hardware names in the AI space, and they represent 37.9% of the total value of the portfolio: Stock iShares ETF Portfolio Weighting 1. Broadcom 8.69% 2. Nvidia 8.01% 3. Texas Instruments 7.49% 4. Advanced Micro Devices 6.97% 5. Qualcomm 6.81% Data source: iShares. Portfolio weightings are accurate as of April 25, 2025, and are subject to change. Broadcom makes AI accelerators for three unnamed hyperscale customers which can be customized to suit their needs, so they are a great alternative to traditional GPUs from suppliers like Nvidia. Broadcom thinks it could capture up to $90 billion in annual revenue from those three customers alone by fiscal 2027. Beyond chips, the company sells data center switches and networking equipment to facilitate rapid processing speeds, which is also critical for AI developers. Despite growing competitive threats, Nvidia's data center GPUs are still the benchmark in AI hardware. The company recently unveiled its Blackwell Ultra GB300 GPU, which delivers a 50-fold performance bump in certain configurations compared to its old Hopper-based H100. The Blackwell Ultra architecture was designed for "reasoning" AI models, which require up to 100 times more computing power than traditional large language models, according to Jensen Huang. Advanced Micro Devices (AMD) is an emerging powerhouse in the data center space. It has its own lineup of AI GPUs, and its latest MI355X is built on a new architecture called CDNA (Compute DNA) 4, which was designed to rival Nvidia's original Blackwell architecture. However, those chips won't ship to customers in high volumes until midyear, so Nvidia still has a significant first-mover advantage. But it's not all about the data center, because AMD is also a top supplier of AI chips for personal computers, which could be a big growth market in the future. Outside of the above stocks, the iShares ETF holds a number of other prominent AI hardware names. They include Micron Technology, which supplies memory and storage chips, and Taiwan Semiconductor Manufacturing, which fabricates most of the GPUs designed by Nvidia and AMD. The iShares ETF has a long track record of success President Donald Trump imposed a broad 10% tariff on all imported goods from America's trading partners in early April, in addition to a series of higher "reciprocal tariffs" on specific countries. However, semiconductors are exempt from the reciprocal levies, mainly because leading the AI race is a matter of national security for the U.S. Nevertheless, trade tensions could drive an economic slowdown, which might affect demand for chips in the short term as data center operators reevaluate their budgets. Data by YCharts. But here's the good news: The iShares Semiconductor ETF has delivered a compound annual return of 10.4% since it was established in 2001, beating the average annual gain of 7.8% in the S&P 500 over the same period. Plus, the ETF has delivered an accelerated annual return of 20.9% over the last 10 years specifically, thanks to the broad adoption of technologies like enterprise software, cloud computing, and now AI. The point is the iShares ETF has weathered a number of economic shocks during its 24-year history -- including President Trump's last tariff saga in 2018 -- while still delivering strong returns. If data center spending does grow to an annual rate of $1 trillion by 2028 as Jensen Huang predicts, then those returns are likely to continue (if not accelerate further). As a result, this might be a great time to buy the iShares ETF, especially considering its year-to-date dip of 16%. Should you invest $1,000 in iShares Trust - iShares Semiconductor ETF right now? Before you buy stock in iShares Trust - iShares Semiconductor ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and iShares Trust - iShares Semiconductor ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $607,048!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $668,193!* Now, it's worth noting Stock Advisor 's total average return is880% — a market-crushing outperformance compared to161%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of April 28, 2025
Yahoo
16-03-2025
- Business
- Yahoo
What To Expect From Nvidia's GPU Technology Conference
Nvidia is set to kick off its weeklong GPU Technology Conference in San Jose, California on Monday, with a keynote address from CEO Jensen Huang on Tuesday. Investors will be watching for updates on Nvidia's Blackwell Ultra chips, as well as its next-generation Rubin architecture. The chipmaker's stock has struggled in 2025, creating a "compelling valuation" ahead of the conference, one analyst (NVDA) is set to kick off its weeklong GPU Technology Conference in San Jose, California on Monday, with a keynote address from CEO Jensen Huang on Tuesday. Investors and analysts will likely be watching for updates on the company's latest artificial intelligence chips, upcoming releases, and developments in gaming and robotics. The AI chipmaker is expected to showcase its Blackwell Ultra GB300 family of chips, which Deutsche Bank analysts said is expected to deliver over 50% more memory capacity and significantly higher performance than its earlier Blackwell offerings. The timing of GB300's rollout will be a focus, the analysts said, particularly as Nvidia has faced delays in fully ramping up Blackwell production. Nvidia could also offer more details on its Rubin GPU, the successor to Blackwell expected in 2026, along with its associated Vera CPU, and the Rubin Vera platform. It's possible Huang's keynote could offer breadcrumbs at what lies a generation beyond Rubin, analysts said. GTC comes as Nvidia's stock has fallen nearly 10% so far in 2025, creating a 'compelling valuation' heading into the conference, analysts at Bank of America said. The analysts reiterated a 'buy' rating and $200 price target, above the average of analysts tracked by Visible Alpha. The consensus target at $177 would suggest over 45% upside from Nvidia's closing price of $121.67 Friday. UPDATE—March 14, 2025: This article has been updated since it was first published to reflect more recent share price values. Read the original article on Investopedia Sign in to access your portfolio
