In a Predicted Scenario: Every Fortune 500 Company May End Up Reimbursing Nvidia by 2035, as Per Recent Projections
In the rapidly evolving landscape of artificial intelligence (AI), Nvidia finds itself at the heart of a significant revolution. The company's Compute Unified Device Architecture (CUDA) software serves as the native language of AI for an army of 2 million developers, making it the deepest moat around the specialized work of training AI.
However, this dominance is not without potential vulnerabilities. Advanced Micro Devices and cloud giants are building alternative routes for AI inference, bypassing the CUDA toll. This competition is expected to intensify as intelligence becomes a utility, with early investors realizing they might have bought more than just a semiconductor stock—perhaps the cognitive infrastructure toll of the 21st century.
Nvidia's market role extends beyond being a semiconductor leader. It is laying the rails for artificial general intelligence (AGI) itself. Companies actively involved in developing AGI and expecting it by around 2030 include DeepMind (a subsidiary of Google), with CEO Demis Hassabis predicting AGI could be achieved by 2030 and describing the transformative potential of such technology. OpenAI is also a major player in advanced AI development, contributing to the field with its large language models and ongoing research. These efforts are supported by advancing compute power, data availability, and algorithm improvements seen across the industry.
Wall Street expects Nvidia's revenue to reach $254 billion by fiscal 2027, a significant leap from its current figures. This growth is also projected to continue, with Nvidia's revenue reaching $130.5 billion in fiscal 2025, more than doubling from the previous year. With 24.39 billion shares outstanding, this translates to a potential share price of $369 per share, a double from the current price.
However, the success of Nvidia's investment case largely depends on whether AGI will arrive by 2030. If AGI does materialize, Nvidia stands to benefit greatly. In the bull case, if Nvidia captures 50% of a $5 trillion AGI computing market, the stock could reach $615 per share.
Notably, even companies like Alphabet and Tesla, among others, still buy Nvidia's GPUs despite building their custom chips. This loyalty is reflected in OpenAI's annual spending of $7 billion on Nvidia hardware. Furthermore, Salesforce has more than 8,000 customers using its AI agents, and Microsoft has committed $100 billion to AI data centers.
Sovereign nations are also investing heavily in this future. Saudi Arabia, the United Arab Emirates, and Japan have pledged $90 billion for sovereign computing, further solidifying Nvidia's position as a key player in the AI race.
Leaving Nvidia's ecosystem comes with a multibillion-dollar tax in retraining models, porting years of code, and accepting major performance penalties. This suggests a level of stickiness that could keep Nvidia at the forefront of the AI revolution for years to come.
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