Nvidia Stock Has Soared 24,000% in 10 Years | NVDA Stock Analysis

Summary

Nvidia's success stems from its long-term vision and strategic focus on accelerated computing, starting from its founding in the 1990s. CEO Jensen Huang attributes the company's growth to predicting the rise of specialized computing beyond general-purpose systems, particularly in AI. Nvidia's stock price and revenue have surged dramatically over the past decade, supported by advances in GPU architecture, software ecosystems, and expansion into new markets like gaming, self-driving cars, robotics, and climate technology. This steady foundation over 30 years has positioned Nvidia as one of the most valuable companies globally.

Takeaways

• 🚀 Nvidia's market capitalization is nearly $3 trillion, placing it just behind Microsoft and Apple.
• 📈 Nvidia's stock price has surged by 24,500% over the last decade, driven by a 2,000% increase in revenue and a 9,000% increase in profits.
• 🔮 The company's success is attributed to its long-term vision that there would be a form of computing to augment general-purpose computing, dating back to its founding in the late 1990s.
• 🧠 Nvidia correctly forecasted the future of the computing industry, enabling them to capitalize on the rise of AI and accelerated computing.
• 🎮 Nvidia started with computer graphics, primarily for gaming, and has now grown to serve a broad range of industries including AI, robotics, self-driving cars, and more.
• 🛠 Nvidia's CUDA software and large ecosystem investments have created a massive installed base, making it a leader in various sectors.
• 💼 Nvidia's ability to pivot and learn new algorithms for different markets has been a key to its growth, allowing it to tackle diverse applications like large language models and data processing.
• 🧱 The company has built rich libraries for multiple domains, such as virtual screening, climate technology, and robotics, adding cumulative value over time.
• 📊 Nvidia's market value is supported by real increases in revenue and profitability, not just market excitement around AI.
• ⏳ The company's current success is the result of decades of foundational work, proving it is no overnight success story.

Q & A

How has Nvidia's market capitalization positioned it among the top companies in the world?

Nvidia's market capitalization of nearly $3 trillion places it behind only Microsoft and Apple, making it the third-largest company in the U.S.

What has driven Nvidia's stock price growth over the last decade?

Nvidia's stock price has grown by 24,000% over the past decade, driven by a 2,000% increase in revenue and a 9,000% increase in profits, supported by its focus on AI and accelerated computing.

What core vision helped Nvidia achieve its current success?

Nvidia's success stems from its long-range vision of developing a new form of computing that could augment general-purpose computing to solve specialized problems.

Did Nvidia get lucky with the AI boom, or was its success planned?

Nvidia's success was not just a result of the recent AI boom. Its long-term strategy, starting from its founding in the 1990s, was key to its position today.

What mistake did many electric vehicle (EV) companies make compared to Nvidia's success?

Many EV companies were overly optimistic in forecasting rapid growth, leading to significant financial losses. In contrast, Nvidia made accurate predictions, particularly in computing and AI, which allowed it to thrive.

How long has Nvidia been building its technology to reach its current level of success?

Nvidia has been building its technology and ecosystem for over 30 years, steadily advancing its position in various markets, particularly with accelerated computing.

What role does Nvidia's CUDA software play in its success?

Nvidia's CUDA software has a massive installed base, and the company's investment in software and architecture compatibility since 1993 has played a fundamental role in its success.

How has Nvidia's gaming sector contributed to its overall success?

Nvidia started with computer graphics for gaming, with its GeForce products now used by over 300 million gamers worldwide. This strong foundation has supported the company's expansion into other markets.

What challenges does Nvidia face when entering new markets with its accelerated computing solutions?

Nvidia must learn new algorithms, understand market dynamics, and create new ecosystems each time it enters a new market, requiring precise targeting of its accelerated computing capabilities.

What libraries has Nvidia developed to support its growth in different industries?

Nvidia has built libraries for various fields, including self-driving cars, robotics, virtual screening, and climate technology, which have added cumulative benefits over the years.

Outlines

00:00

🚀 Nvidia's Phenomenal Growth and Vision

Nvidia has become one of the most successful businesses globally, with a market capitalization nearing $3 trillion, only behind Microsoft and Apple. Its stock price surged by an astonishing 24,500% over the last decade, supported by a 2,000% increase in revenue and a 9,000% rise in profits. The company's success is attributed to its visionary approach, predicting the need for specialized computing to augment general-purpose computing. Nvidia's CEO, Jensen Huang, credits this long-term vision dating back to the company's founding in the 1990s. While some companies, like those in the EV sector, miscalculated growth, Nvidia's accurate forecasting has brought them tremendous success. Their growth is a result of decades of building a strong foundation, particularly around their Cuda software, which has now become a massive industry standard.

05:01

🎮 Nvidia's Expansion into Gaming and Beyond

Initially starting in the gaming industry, Nvidia now has a massive installed base of 300 million gamers using its GeForce product. Each time Nvidia entered a new market, they learned new algorithms, market dynamics, and created new ecosystems, eventually transitioning into accelerated computing. Nvidia's success lies in choosing the right areas for acceleration, whether it's large language models, data processing, or recommender systems. This ability to adapt and serve multiple industries has propelled them to a market capitalization of $2.92 trillion. Nvidia's libraries, which power technologies like self-driving cars, robotics, and climate tech, are the result of 30 years of strategic development. The company's recent success is built on decades of groundwork.

Keywords

💡Nvidia

Nvidia is a global technology company known for its role in designing and manufacturing GPUs (Graphics Processing Units), originally for gaming and now heavily used in AI and data processing. The company’s success is attributed to its long-term vision of accelerated computing, which has positioned it as one of the most valuable companies in the world with a market cap of nearly 3 trillion dollars.

💡Accelerated Computing

Accelerated computing refers to the use of specialized hardware like GPUs to perform computing tasks more efficiently than traditional general-purpose CPUs. Nvidia recognized the potential for accelerated computing early on, which has enabled them to serve various markets from AI to robotics, significantly contributing to their growth.

💡Market Capitalization

Market capitalization is the total value of a company’s outstanding shares. Nvidia’s market capitalization has soared to nearly 3 trillion dollars, making it the third-largest company in the U.S. behind Microsoft and Apple. This reflects the immense value the market sees in Nvidia’s technology and future prospects.

💡AI (Artificial Intelligence)

AI is a core technology that Nvidia has successfully harnessed with its GPUs, especially in fields like large language models, recommender systems, and data processing. The video emphasizes that Nvidia’s focus on AI has been a major driver of its stock price and profitability, as the world increasingly relies on AI-driven solutions.

💡Revenue Growth

Revenue growth refers to the increase in a company’s sales over time. In the past decade, Nvidia has experienced a 2,000% increase in revenue, which has supported its massive stock price growth. This revenue growth is tied to its strategic expansion into various sectors, including AI, gaming, and robotics.

💡CUDA Software

CUDA is Nvidia’s parallel computing platform and programming model, which enables developers to harness the power of Nvidia GPUs for general-purpose computing tasks. Nvidia’s CEO emphasized that CUDA has created a massive installed base, which is critical to Nvidia’s dominance in various computing markets.

💡Founder’s Vision

Founder’s vision refers to the long-term strategy and foresight that Nvidia’s CEO Jensen Huang had when he founded the company. This vision involved predicting the importance of accelerated computing decades before it became mainstream. The video credits this foresight as the key reason behind Nvidia’s extraordinary success today.

💡GeForce

GeForce is Nvidia’s flagship brand for gaming GPUs. The video highlights how Nvidia started by serving the gaming market, which helped it build a large installed base. Today, GeForce is used by 300 million gamers worldwide, showcasing Nvidia’s dominance in the gaming industry, which was foundational to its success.

💡Large Language Models

Large language models are AI models trained to understand and generate human language. Nvidia’s accelerated computing technology is pivotal in training and deploying these models. This capability has positioned Nvidia as a leader in the AI space, contributing to its revenue growth and market dominance.

💡Ecosystem Development

Ecosystem development refers to the process of creating and nurturing a network of technologies, tools, and partners around a core product. Nvidia’s success is partly due to its ability to develop an ecosystem around its GPUs and CUDA software, which has attracted developers, businesses, and industries, leading to widespread adoption.

Highlights

Nvidia is now one of the most successful businesses in the world, with a market capitalization of nearly $3 trillion, behind only Microsoft and Apple.

Nvidia's stock price has increased by 24,500% over the last decade, supported by a 2,000% increase in revenue and a 9,000% increase in profits.

Nvidia's success is largely attributed to its long-term vision of a new form of computing that would augment general-purpose computing, dating back to its founding in the late 1990s.

CEO Jensen Huang emphasized that Nvidia's accurate long-range forecast and vision have been key to its current success.

In contrast to Nvidia, many electric vehicle companies made overly optimistic forecasts about EV growth and are now facing financial difficulties.

Nvidia's success has been 30 years in the making, not a sudden outcome of the recent AI boom, as they have been building an ecosystem since the 1990s.

Nvidia's CUDA software has a massive installed base, thanks to early and consistent investment in architecture compatibility and ecosystem development.

Nvidia is the largest provider of video game architecture in the world, with GeForce products used by over 300 million gamers globally.

Nvidia has entered and succeeded in various markets by learning new algorithms, market dynamics, and creating new ecosystems for each step.

Nvidia has become a leader in accelerated computing, allowing it to focus on specific use cases like large language models, data processing, and recommender systems.

Nvidia now holds the third-largest market capitalization in the U.S., trailing only Microsoft and Apple.

Nvidia has been developing libraries for specific industries, including self-driving cars, robotics, virtual screening, and climate technology.

The company's success is built on decades of library and ecosystem development, giving it cumulative advantages in various fields.

Newcomers to Nvidia may think its success is recent, but the company has been building its foundations for over 30 years.

Nvidia's strong competitive advantages and growth prospects stem from its early investments and long-term strategy, not just recent AI breakthroughs.

Transcripts

Nvidia has grown to be one of the most

successful businesses in the world its

market capitalization of nearly three

trillion dollar is only behind Microsoft

and Apple nvidia's stock price is up by

a whopping 24.

5,000% over the previous decade but that

stock price growth has been supported by

2,000% increase in revenue and 9,000 per

increase in profits in that same time

phenomenal all that being said how did

Nvidia get here did it just get lucky to

have the right product at the right time

is it just a beneficiary of an

unreasonable excitement surrounding AI

let's learn more about how Nvidia got to

be one of the most valuable companies in

the world today I want to thank the mle

fool for sponsoring this video visit

full.com parev for the 10 best stocks to

buy now so at an investor conference

yesterday Nvidia CEO Jensen hang talked

about this how Nvidia got here what did

they get right and the CEO said that the

thing we got right the one thing we got

right is our vision that there would be

another form of computing that could

augment general purpose Computing to

solve problems that a general purpose

instrument won't ever be good at in

other words what Nvidia got right is the

long range forecast the long range

vision of what the Computing industry

will look like 10 years from now 20

years from now it got that right all the

way back at its founding in the late

1990s so that big decision Nvidia got

right and being right and so

phenomenally right is what brought

Nvidia to where it is today that

underlying that core forecast and Nvidia

got it right and that's difficult to do

and in fact I've been talking a lot

about EV stocks this year and EV

companies did this quite the opposite

they got this wrong really wrong in the

last four or five six years or so they

forecasted EV growth would be so

phenomenal in these next couple of years

and it turns out it's nowhere near

anywhere they were forecasting and many

of these companies are going bankrupt or

losing billions of dollars on the bottom

line trying to recover from that initial

miscalculation that initial forecast

that was too optimistic whereas Nvidia

hit the nail right on the head they got

it phenomenally right and now they're

reaping the benefits of this Founder's

Vision when I talk about reaping the

benefits let's take a look at some of

those benefits here Nvidia stock price

in the last 10 years years is up

24,000 per

24.3 th000 per in that time it's

incredible by how much Nvidia stock

price has increased in that time and the

revenue growth has been phenomenal as

well 2,000% increase in Revenue in the

last 10 years and that's been supported

by profitability as well with net income

jumping by 9,000 per in that time so the

business the price growth has been

supported by increases in revenue and

profitability and you can see that

hockey stick type pattern in the last

year and a half or so on the back of the

rising effectiveness of AI the CEO went

on to say this way of thinking about

architecture compatibility creating a

large installed base taking the software

investment of the ecosystem along with

us that psychology started in 19

1993 and we carried it to this date

which is the reason why nvidia's Cuda

software has such a massive installed

base and again so when Nvidia CEOs is

asked about the success of the company

he points back to these originating

ideas and why that's fundamental to the

company's success today because they've

been building this since then it's been

a building and building and building and

then you get that success that they've

gotten in the last year and a half and

I've heard saying that says you know it

takes 10 years to become an overnight

success this is similar to that saying

right Nvidia it's taken 30 years for

NVIDIA to be an overnight success and

this is what the CEO is saying like we

didn't just all of a sudden jump on the

scene two years ago and benefited from

this AI craze like we've been around for

three decades we've been building this

we've been help helping create this

ecosystem that's led to these

breakthroughs that you're seeing today

as a consumer as a user as an investor

goes on to say that Nvidia is the

largest installed base of video game

architecture in the

world Nvidia started out as computer

graphics for primarily for gaming but

GeForce is now some 300 million gamers

in the world are using this product and

it's growing incredibly well so every

single time we have to go enter a new

market we had to learn new algorithms

new market dynamics create new

ecosystems and they've done this at each

step of the way building up to where

they are today where they're serving so

many different markets and so they're

now an accelerated computer which means

the question you have to ask yourself is

what do you accelerate there's no such

thing as a universal accelerator so you

have to decide where you're going going

to point this tool at where you're going

to point this weapon at do you want to

use accelerated Computing to

solve large language models or create

large language models train large

language models or do you want to use

accelerated Computing for data

processing or do you want to use

accelerated Computing for recommender

systems so you have to choose where you

want to point this at and Nvidia has

been able to do that at each step of the

way

delivering specific use cases for its

accelerated Computing and that has

partly fueled nvidia's success it's now

trading at a market capitalization of

2.92 trillion just ever so slightly

behind Microsoft at 3.17 trillion and

Apple at

3.38 trillion as the third largest

market market capitalization company in

the United States and so from the

beginning Nvidia has been building these

libraries and everything on these

libraries we they had to do the computer

science secondly they had to go through

the ecosystem development and they had

to convince everybody to use it now they

have a rich library for self-driving

cars they have a library for robotics

they have a library for virtual

screening whether it's physics based

virtual screening or neural network

virtual screening and they have a

library for climate technology so all

along the way they've been building

these libraries and it's adding a

cumulative benefit as the years have

progressed so those of you that are new

to Nvidia or are just learning about

Nvidia and have just started to research

Nvidia because of its incredible success

in the last two years remember that this

success started 30 years ago

Nvidia started this 30 years ago and

they've been working their way towards

this level where they're now an

incredibly profitable business with

phenomenal growth ahead excellent

prospects great competitive advantages

all because of the beginning of the

company and the foundations they laid

they laid throughout that entire process

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