Nvidia Has a Brilliant AI Business Poised to More Than Double Revenue to $20-Plus Billion This Year, Yet It Gets Little Coverage

Core Insights - Nvidia's sovereign AI business is projected to achieve over $20 billion in revenue this year, more than double last year's figures, indicating rapid growth within the company's overall AI-driven data center platform [3][4][11] - The sovereign AI sector is becoming a significant growth engine for Nvidia, with nations investing heavily in AI infrastructure akin to past investments in electricity and the Internet [6][7][12] Revenue Projections - Nvidia's total revenue for the current fiscal year is expected to reach $206.5 billion, a 58% increase from $130.5 billion last fiscal year, with the sovereign AI business potentially accounting for about 9.7% of total revenue [8][9] - The sovereign AI business likely generated around $8 billion in the first half of the fiscal year, representing approximately 10% of the data center's revenue and likely growing over 100% year-over-year [11] Market Context - The European Union plans to invest 20 billion euros to establish 20 AI factories across several countries, which will significantly enhance AI compute infrastructure [4] - Nvidia's GPUs dominate the market for AI chips, and the company is involved in various national AI infrastructure projects across multiple countries, positioning itself as a key player in the sovereign AI landscape [5][8][12] Strategic Advantages - Nvidia's strategy of not only selling technology but also assisting sovereign entities in their AI initiatives creates strong, lasting relationships, making the sovereign AI business particularly "sticky" [12] - Familiarity with Nvidia's technology among companies, researchers, and students using sovereign AI infrastructure may lead to increased future sales of Nvidia's offerings [13]