5. NVIDIA Corp. (NASDAQ:NVDA)
Number of Hedge Fund Holders: 223
NVIDIA Corp. (NASDAQ:NVDA) is a computing infrastructure company. The company’s Compute & Networking segment primarily includes Data Center computing platforms and end-to-end networking platforms. The main offerings in its Graphics segment encompass the GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service, and related infrastructures.
The company’s Data Center segment is foundational to its growth and grew by 93% year-over-year in FQ4 2025, while it doubled year-over-year for the full fiscal year 2025. This growth was driven by the rapidly increasing demand for AI infrastructure. 50% of the company’s total revenue comes from major cloud providers. However, these providers are currently looking for more cost-effective alternatives and trying to reduce their reliance on NVIDIA Corp. (NASDAQ:NVDA) after seeing developments like that of DeepSeek. For this reason, the company’s FQ1 2026 revenue growth guidance is also 9.4% sequentially, which is lower than the previous 12% figure.
At the same time, new US AI Diffusion Rules have also been introduced. These rules aim to control the global distribution of advanced AI chips and other technologies so that the spread of powerful AI can be regulated. However, Bank of America still reaffirmed its Buy rating on the company with a $200 price target of March 28. This is because Large CSPs like Azure, GCP, AWS, and OCI are using the company’s Blackwell systems to meet their growing infrastructure demands.
Guinness Global Innovators is highly bullish on NVIDIA Corp. (NASDAQ:NVDA) due to its dominant AI chip market position. It stated the following in its Q4 2024 investor letter:
“For a second year running, NVIDIA Corporation (NASDAQ:NVDA) was the Fund’s top performing stock, delivering a stellar return of +177.7% over the year. Since the beginning of last year, Nvidia’s ‘Hopper’ GPUs have been at the centre of exploding demand for chips powerful and efficient enough to facilitate the energy intensive requirements of AI processes within datacentres. Initially possessing over 95% of market share in these types of chips, Nvidia have been quick to entrench their position as the technological leader in the space, launching the successor to the current ‘Hopper’ GPU in March, Blackwell, inhibiting the likes of AMD and Intel making meaningful inroads in taking share of the fast-growing market. Compared to the previous iteration (Hopper) which is continuing to fuel Nvidia’s extreme revenue growth, the Blackwell chip is twice as powerful for training AI models and has 5 times the capability when it comes to “inference” (the speed at which AI models respond to queries). Throughout the year, Nvidia’s financial performance has remained resilient. Quarterly revenues hit $35.1 billion in their most recent quarter, beating consensus expectations by 6% and representing a +94% year-over-year increase. Additionally, Nvidia’s data centre segment, driven by the Hopper (H100) chip, grew fivefold over the past year, underscoring the sustained demand for advanced AI infrastructure. The H100 chip, priced at around $40,000, continues to see significant adoption due to its ability to enhance AI model training efficiency while lowering overall costs. This growth is expected to continue as companies invest in upgrading existing data centres and building new ones, with Nvidia well-positioned to capture a significant share of the estimated $2 trillion market opportunity over the next five years. There have been some concerns over Blackwell production delays causing share price volatility however, Nvidia has recovered swiftly, driven by positive earnings results through the year and assurances from management regarding future supply. Additionally, the release of the H200 chip promises to extend Nvidia’s technological leadership, ensuring continued momentum into 2025. While Nvidia’s valuation remains a topic of debate, the stock is not at a significant premium to history, and it still appears reasonable given its dominant market position, innovative prowess, and exposure to long-term secular growth trends in AI, cloud computing, and data infrastructure. As a result, Nvidia remains well-positioned to deliver sustained outperformance over the long term, making it a cornerstone of growth-oriented portfolios.”
