The thesis

NVIDIA dominates the AI accelerator market with its GPU architecture. The company is in a strong macro moment with AI Buildout driving revenue growth of 105.8% YoY. Despite a high conviction tier of DORMANT (composite 19/100), NVIDIA's data centre segment is performing well, accounting for the majority of fiscal 2025 revenue. Gross margin is 74.67%, indicating strong profitability.

Why now

The AI Buildout is gaining momentum, with hyperscaler AI training and inference capital expenditure flowing directly to NVIDIA's GPU revenue. Trump's statement on keeping the US ahead in AI adds to the macro context, potentially accelerating AI-related investments.

What to watch

Revenue growth and gross margin expansion over the next quarter will be key indicators of NVIDIA's continued dominance in the AI accelerator market. Any updates on export controls or competitive developments from AMD and custom ASIC players will also be crucial in determining the validity of the thesis.

Key risks

Export controls and competitive pressure from AMD and custom ASICs are key risks that could impact NVIDIA's market share and revenue growth. High valuation multiples, such as P/E of 27.9x, also pose a risk if growth slows down.

Theme exposure

Upcoming catalysts