Analyst Says Market Concerns After Nvidia (NVDA)-OpenAI Deal Are ‘Wrong’

Core Viewpoint - The market's concerns regarding NVIDIA Corp's $100 billion deal with OpenAI are considered misguided, as the investment is seen as essential for NVIDIA to maintain its competitive edge in the AI infrastructure space [2][3][4]. Company Analysis - NVIDIA's recent deal with OpenAI and Intel highlights the ongoing significant investment in AI infrastructure, indicating that demand for AI is expected to remain strong [3][4]. - Despite a 56% annual revenue growth reported recently, NVIDIA's growth rate is slowing compared to nearly 100% YoY growth in previous quarters, attributed to increased competition and capital expenditure limitations from major companies [4][5]. - The company is likely to continue growing due to its strong position in the data center market, although the growth rate may not match past performance [5]. Market Dynamics - The deal with Intel, where NVIDIA will invest $5 billion, is projected to unlock a $50 billion total addressable market (TAM) for both companies in the data center and PC sectors [5]. - Increased competition from major players like Broadcom is anticipated to impact NVIDIA's margins in the long term [5].