Want to Know What's Next for Nvidia? Look at This 1 Key Number.

Core Insights - Nvidia has experienced explosive growth, with revenue increasing in triple digits and reaching record levels in the billions, primarily due to its dominance in the AI chip market with an 80% market share [1][2] - The stock has surged 2,400% over the past five years, with an annual increase of about 180%, but there are concerns about a potential slowdown in revenue growth [2][5] - Nvidia's GPUs are critical for AI programs, leading to significant demand from major tech companies like Meta and Amazon [3][4] Revenue and Growth - Despite a recent slowdown to double-digit growth, Nvidia's revenue remains high, with quarterly revenue exceeding $35 billion, making comparisons to earlier periods challenging [5] - The company reported revenue of approximately $6 billion in the same quarter the previous year, highlighting the difficulty of maintaining triple-digit growth as revenue scales up [5] Profitability - Nvidia has maintained gross margins above 70%, indicating strong profitability on sales [7] - A slight dip in profitability is expected as the company ramps up production of its new Blackwell architecture, with gross margins predicted to fall to the low-70% range temporarily [8][10] - Long-term forecasts suggest that gross margins will return to the mid-70% range by the second half of next year, supporting continued high profitability [10][11] Market Outlook - The AI market, currently valued at $200 billion, is projected to reach $1 trillion by the end of the decade, indicating strong growth potential for Nvidia [11] - Investors are encouraged to focus on Nvidia's long-term prospects rather than short-term fluctuations, given the company's profitability track record and positive forecasts [12]