Nvidia (NVDA +0.76%) has been the biggest success story of the artificial intelligence (AI) era thus far with the stock jumping more than tenfold from the start of 2023, shortly after ChatGPT came out, to its recent peak.
Nvidia's market capitalization, which now hovers around $3 trillion, topped out at close to $4 trillion a few months ago. No other company in the history of the stock market has created as much wealth as quickly. Not surprisingly, Nvidia is still closely followed by investors, some of whom want to know if the stock can keep climbing, and others who want some assurance that their windfall gains won't suddenly disappear in a stock market slump.
Nvidia's shares have already given up some of those gains, sliding 23% (as of March 19) from its peak in January as a combination of weakening consumer and business sentiment, slowing revenue growth, and some doubts about long-term AI demand have weighed on the stock.
However, because of that pullback, Nvidia is now the cheapest it's been since 2019, arguably setting up a buying opportunity. Is Nvidia a buy right now? Let's take a look at what the company could have in store for the rest of the year.
Image source: Nvidia.
No slowing down
Nvidia recently hosted its annual GTC conference -- all heavily focused on AI -- and if there was one takeaway from the event, it's that the company has no intention of resting on its laurels.
At the conference, CEO Jensen Huang outlined the company's product roadmap including future chip platforms like Rubin and Feynman, and touted AI forecasts, including one that showed data center capital expenditure spending reaching $1 trillion by 2028. The company also announced new partnerships, including one with General Motors to build autonomous vehicles.
Among its other announcements, the company said it would build an accelerated quantum computing research center, giving it a stake in an emerging technology that some think could be as influential as AI. Nvidia also unveiled new partnerships with cloud hyperscalers Oracle, Microsoft, and Alphabet, ensuring that it maintains close relationship with its top customers and that its chips and components continue to meet their needs.
It also introduced a multi-year plan that showed investors it would continue to push the envelope in AI. For example, Huang told the GTC audience that Rubin, its next GPU generation that is set to be released in late 2026, would power a supercomputer that is 14 times more powerful than the current equivalent, and requires less power.
NASDAQ: NVDA
Key Data Points
The macroeconomic landscape
Nvidia faces a number of company- and industry-specific risks, namely that it needs AI spending to continue to increase, but there are also macroeconomic factors that have weighed on the stock and are keeping some investors cautious.
The semiconductor industry is cyclical, and Nvidia has gone through several economic cycles before with the stock falling sharply. That doesn't mean the AI boom is about to end, but investors should be mindful of that risk.
Tariffs also present a risk to the company, though it has already been forced to adapt to restrictions on exports to China, meaning that the trade war isn't an entirely new challenge. Given the company's 78% revenue growth in the fourth quarter and its strong guidance for the first quarter, the macro uncertainty doesn't appear to be impacting Nvidia's business, though it may be weighing on the stock.
A recession or a slowing economy could impact growth of the business. However, the big tech companies that make up its biggest customers are all well-capitalized and therefore have the resources to continue to invest in AI. They also believe that underspending on the new technology is a greater risk than overspending.
What to expect for Nvidia in 2025
It's impossible to perfectly predict a stock's performance, but 2025 is shaping up to be another strong year for Nvidia's business even if macro-level concerns are weighing on the broader stock market.
The company is continuing to be aggressive with its business expansions, partnerships, and new product launches, and demand for the new Blackwell platform, which is now in full production, is outstripping supply.
Expect Nvidia to unveil more partnerships and product advances as the year goes on. While investors may have one eye on potential headwinds facing the company, such as the impact of DeepSeek, the overall outlook for Nvidia still looks strong, and the stock is trading at an attractive valuation following the recent pullback.
