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Conversations about artificial intelligence (AI) inevitably include: Nvidia (NVDA 3.12%). The company pioneered graphics processing units (GPUs), which power many of the world’s most advanced AI models, and continues to innovate at a breakneck pace.
At the company’s GPU Technology Conference (GTC), which kicked off Sunday in San Jose, Calif., Nvidia announced some surprising developments Monday that suggest the AI revolution is just beginning. What was revealed at the conference strengthened the argument for investing in the company. Here are three reasons to buy Nvidia stock like there’s no tomorrow.
Image source: Getty Images.
1. Nvidia unveils next “must-have” AI processor
When ChatGPT arrived in late 2022, the race to adopt generative AI was on. The potential to leverage these next-generation AI models to improve productivity has left businesses scrambling to figure out how to get the most out of AI developments. The processor that made these advances possible is his Nvidia H100 Tensor Core GPU, which can train large-scale language models (LLMs) up to 30 times faster than previous generation AI chips. Now, these processors are from last year.
Nvidia on Monday announced its Blackwell platform “powering a new era of computing.” CEO Jensen Huang says the Blackwell B200 Tensor Core GPU is “the world’s most powerful chip” for AI. This processor has 208 billion transistors (up from 80 billion in the H100), giving it five times the performance. This architecture combines two tightly integrated GPUs that work together. Blackwell GPUs scale up to 10 Trillion parameter. For context, GPT-3, the LLM behind ChatGPT, had just 175. a billion parameter.
Additionally, the GB200 Grace Blackwell superchip combines two B200 chips, a Grace CPU, and an NVLink high-speed interconnect, with all parts working together. AI-centric processors deliver up to 30x the performance of previous generation processors while reducing energy consumption by up to 25x.
2. Cloud providers are lining up to buy Nvidia products
As with Nvidia’s previous AI-centric processors, the biggest cloud infrastructure providers are lining up to deliver their latest offerings via the cloud.
Amazon Web Services (AWS) announced the availability of the GB200 Grace Blackwell Superchip, which AWS CEO Adam Selipsky said “represents a significant advance in generative AI and GPU computing.”
It also became clear that microsoft The company will be “one of the first organizations to bring the power of the Nvidia Grace Blackwell GB200 to the Azure cloud.” The company announced that Nvidia processors will provide AI predictions for Microsoft Copilot, a digital assistant powered by generative AI. Don’t be left behind. alphabet The company adopted the Blackwell platform and said, “DGX Cloud, powered by Grace Blackwell, is coming to Google Cloud.”
This was just the tip of the iceberg, as Nvidia announced partnerships with several of the biggest names in the technology industry, including: oracle, Dell Technologiesand meta platformbetween many others.
3. It’s not just Nvidia hardware
Nvidia has made a name for itself by developing processors that power AI, but it does much more than that.
The company introduced Nvidia Inference Manager (NIM), a breakthrough software platform that helps developers streamline the creation and deployment of AI systems. Nvidia provides pre-built and optimized AI models that businesses can adapt using their own data. This eliminates the need for companies to reinvent the wheel and significantly reduces the time needed to implement AI. These tools can help small and medium-sized businesses that don’t have the resources of the aforementioned tech giants to adopt and implement AI.
This helps explain Nvidia’s strategy to increasingly involve complete packages of hardware and software to help businesses succeed.
Is Nvidia stock a buy?
Despite its seemingly unassailable lead in this space, Nvidia continues to innovate at a breakneck pace, taking AI processing to the next level. This is evidenced by the company’s performance and its stock price, which has soared more than 500% since early 2023, marking the emergence of generative AI.
Despite these gains, many, myself included, believe this is just the beginning, and that accelerated adoption of AI will continue to further strengthen the fortunes of Nvidia and its shareholders.
Additionally, with a price-to-earnings ratio of just 36 times next year, NVIDIA stock is very expensive relative to its opportunities.
John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool’s board of directors. Randi Zuckerberg is a former head of market development and spokesperson at Facebook, sister of Meta Platforms CEO Mark Zuckerberg, and a member of the Motley Fool’s board of directors. Alphabet executive Suzanne Frye is a member of The Motley Fool’s board of directors. Danny Vena has held positions at Alphabet, Amazon, Meta Platforms, Microsoft, and he has Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, Microsoft, Nvidia, and Oracle. The Motley Fool recommends the following options: A long January 2026 $395 call on Microsoft and a short January 2026 $405 call on Microsoft. The Motley Fool has a disclosure policy.
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