Nvidia, the designer of the world's top graphics processing units, has seen its revenue and stock price soar in recent years thanks to its leadership in artificial intelligence. The company delivered high-powered GPUs to the market at just the right time, establishing itself as a market leader. Its innovation, updating GPUs annually, has kept this momentum going.
Nvidia's revenue surged to more than $130 billion in the most recent full year, with gross margin steadily above 70%. One quarter early last year was an exception when Nvidia took a charge for inventory it couldn't sell to China due to export controls, but this was a unique event. The shares have climbed 1,000% in three years.
Late last year, Nvidia announced a partnership with telecom giant Nokia. Nvidia aims to help transform the telecom industry by building an AI platform for the transition to 6G technology from 5G. As part of this, Nvidia announced its Arc Aerial RAN Computer, an AI-driven telecommunications computing platform.
At CES last week, Nvidia announced Alpamayo, a family of AI models to boost autonomous vehicle development. Using reasoning, these models may play a key role in ensuring safety. Nvidia also has portfolios for robotics and autonomous vehicles, offering basic tools needed to develop these innovations.
Nvidia chief Jensen Huang commented at CES, "Our job is to create the entire stack so that all of you can create incredible applications for the rest of the world." The company's efforts to build out products and services that support many industries and applications represent a major move.
The Motley Fool Stock Advisor analyst team identified what they believe are the 10 best stocks for investors to buy now, and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004; if you invested $1,000 at the time of the recommendation, you'd have $482,209. Or when Nvidia made this list on April 15, 2005; if you invested $1,000 at the time of the recommendation, you'd have $1,133,548.
Stock Advisor's total average return is 968%, a market-crushing outperformance compared to 197% for the S&P 500. Adria Cimino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia.