Nvidia's AI Dominance Is Still Building. Could the Stock Go Even Higher?

• Nvidia's main manufacture is expected to person a 29% compound yearly maturation rate, and it is acold surpassing that.

• The company's immense marketplace headdress points to its spot but besides brings caller challenges.

• Nvidia's price-to-earnings ratio whitethorn astonishment immoderate more-conservative investors.

• 10 stocks we similar amended than Nvidia ›

When it comes to artificial quality (AI) stocks, Nvidia (NASDAQ: NVDA) seems unstoppable. Despite rising by astir 1,500% from its debased successful October 2022, the expanding request for AI continues to bolster Nvidia, which remains the ascendant institution for AI accelerators.

Still, its marketplace headdress present stands astatine astir $4.5 trillion aft blowing past the $5 trillion people successful November. Since ample companies thin to turn astatine a slower pace, smaller companies mightiness look much charismatic to maturation investors.

Knowing this, tin the banal spell higher, oregon should investors rotate retired of Nvidia successful favour of different tech names?

When it comes to a premix of maturation and safety, 1 mightiness conflict to find a banal amended positioned than Nvidia. It's the ascendant subordinate successful the AI accelerator market, and it is dealing with insatiable request for its product.

Moreover, that request is apt to stay strong. Between 2024 and 2030, Grand View Research estimates a compound yearly maturation complaint (CAGR) for the AI spot marketplace of 29%. Nvidia continues to acold transcend that, and successful the 3rd 4th of fiscal 2026 (ended Oct. 26), its $57 cardinal successful gross was up 62% from year-ago levels.

Furthermore, its information halfway segment, which designs the AI accelerators, makes up astir 90% of the company's revenue. That conception reported much than $51 cardinal successful gross successful the aforesaid quarter, rising by 66% implicit the past year.

Keeping up with the accelerated request led to a 71% emergence successful the outgo of revenue. Thus, the company's $32 cardinal successful nett income accrued by 65%, intimately approximating the maturation of its revenue.

Still, the 56% nett net margins spot Nvidia successful an enviable position. Thanks to those profits, it has had capable funds to proceed spending connected innovation and different investments.

Given that staggering level of fiscal growth, it is highly apt that the banal volition proceed to rise.

And that creates a situation for shareholders. The $4.5 trillion marketplace headdress is the world's largest, but it tin besides beryllium a headwind for maturation investors.

For the banal to emergence by 100%, its marketplace headdress would person to turn to $9 trillion. As of today, nary banal has yet reached the $6 trillion mark. As antecedently mentioned, its fiscal maturation should instrumentality Nvidia's banal to that constituent implicit time, but it makes a repetition of the astir 1,500% gains achieved implicit the past 38 months highly improbable.