Where Will Nvidia Be in the Next 3 Years?

Manali Pradhan, The Motley Fool

Sun, Jun 29, 2025, 5:30 PM 5 min read

• Nvidia's full-stack platform made it a primary beneficiary in the ongoing AI revolution.

• Blackwell chips are seeing demand far outpacing supply.

• Although the valuation is expensive, Nvidia can soar even higher from the current levels in the coming three years.

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Rewind to early 2023 -- few believed that Nvidia (NASDAQ: NVDA) could climb any higher. It already felt expensive and fully priced.

Then it surged nearly tenfold, reshaping itself from a chip supplier into a global artificial intelligence (AI) infrastructure behemoth. Today, with a market cap of $3.5 trillion, it's not about whether Nvidia dominates the AI landscape, it's about what's next.

In its most recent quarter (the first quarter of fiscal 2026, ended April 27), Nvidia delivered a jaw-dropping $44.1 billion in revenue, up 69% year over year. For perspective, that's more than Starbucks and Netflix earn combined in a quarter.

Of that total, $39.1 billion came from the data center segment, representing a 73% increase year over year. These results reflect the dramatic demand for the company's AI infrastructure from enterprises and governments.

Several major growth drivers remain intact. Enterprises and cloud providers are investing aggressively in data centers and AI infrastructure. The AI data center market is expected to be worth nearly $100 billion by 2030.

The company's Blackwell architecture chips, the successors to the widely adopted Hopper chips, are already seeing strong demand from hyperscalers and enterprises, primarily for AI inference workloads (deploying AI models in a production environment) -- far ahead of supply. To cater to the demand, Nvidia reserved full production capacity at Wistron's new Taiwan plant through 2026 for Blackwell and Rubin AI servers.

Nvidia is no longer just a chipmaker. It now offers a full-stack solution to accelerated computing needs. From hardware to software and networking, Nvidia's ecosystem supports high-performance and low-latency deployment. Nvidia's software offerings are contributing recurring and high-margin revenue streams. Hence, as software becomes a larger portion of the company's overall revenue mix, gross margin can increase from the already high 61%.

Beyond data centers, Nvidia is also positioned to benefit from the increasing demand for AI technologies across new use cases in areas such as automotive, edge AI, robotics, and industrial design. These use cases are still developing but can prove significant catalysts in the long run.