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DJI Matrice 100. Source: DJI

Graphics card giant NVIDIA (NASDAQ:NVDA) scored a number of crucial design wins in 2015. In October, a modified version of its GT 940M began shipping in some models of Microsoft's first laptop, the Surface Book. In December, Google's flagship tablet, the Android-powered Pixel C, launched with the Tegra X1. A couple of Chromebook models made use of some of its other Tegra processors in 2015, and a few gaming-focused Windows laptops shipped with its high-end GTX 970M and GTX 980Ms graphics solutions.

But its biggest design win may have been the Manifold, announced by drone giant DJI in November. The embedded computer is powered by NVIDIA's Tegra K1. It isn't likely to sell in large numbers, but it strategically extends NVIDIA's reach into the drone market, a fast-growing segment that could play a significant role in NVIDIA's long-term future.

Introducing the Manifold
The Manifold is a computer designed for use in conjunction with DJI's Matrice 100. Retailing for around $3,300, the Matrice 100 is one of DJI's most expensive drones, and among the more expensive drones available in general. Moreover, the Manifold itself costs nearly $500, so the combination of the two is likely outside the budget of the overwhelming majority of would-be drone buyers. Admittedly, DJI is well-aware of this, and doesn't market the Matrice 100 or the Manifold to general consumers. Rather, they're intended as tools for developers.

When it comes to the drone market in general, DJI remains the leader, capturing an estimated 70% of the market in 2014. Last May, it raised $75 million, giving it a valuation of around $10 billion, and in December it opened its first retail store (a gargantuan flagship in excess of 8,000 square feet located in Shenzen, China). DJI's use of the Tegra K1 should be seen as a strong vote of confidence in the potential of NVIDIA's Tegra to power next-generation drones.

NVIDIA remains a graphics card company first and foremost
As a portion of NVIDIA's overall business, drone-related chips are insignificant. About 85% of its revenue last quarter came from its GPUs -- its Tegra processors generated less than 10% of its total revenue. Tegra revenue actually contracted about 23% on an annual basis, to just $129 million. At the same time, NVIDIA's Tegra chips are used in a wide variety of devices. In addition to the aforementioned Chromebooks and Pixel C, various Tegra chips can be found in several automobiles (including Tesla's Model X), powering automotive infotainment systems.

But the drone market remains in its infancy. Analysts anticipate that the demand for drones will surge in the quarters and years to come. Research company The Teal Group believes that spending on drones will double over the next 10 years, totaling more than $93 billion in the process. 

Of course, NVIDIA isn't alone. Rival Qualcomm (NASDAQ:QCOM) has moved into the drone market in recent months, announcing Snapdragon Flight in September. Based on Qualcomm's Snapdragon 801 processor, Snapdragon Flight is aimed at the consumer market, and should allow firms to create cheaper and lighter-weight drones. Ambarella (NASDAQ:AMBA) currently dominates the space, with its chips powering most drone models, including DJI's Phantom 3. On Ambarella's most recent earnings call, management said it expected revenue to rise 15% to 20% during its next fiscal year, driven in part by surging drone demand.

But Qualcomm and Ambarella's chips can't match NVIDIA's high-end Tegras in terms of raw processing power. As drones are tasked with ever-more complex tasks, demand for NVIDIA's powerful Tegra chips could rise. Scoring the Manifold is a strong sign that NVIDIA's chips could play a vital role in the future of the drone market.

Sam Mattera has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Ambarella, Qualcomm, and Tesla Motors. The Motley Fool recommends Nvidia. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.