Nvidia, recognized as a major player in the artificial intelligence semiconductor industry, has seen a decline of 12% in its stock value in 2025, despite reporting strong fiscal results in late February. This situation presents a potentially favorable opportunity for investors.
Nvidia’s dominance in the data center GPU market remains substantial, overshadowing competitors such as Intel and AMD. In fiscal 2025, Nvidia generated $115.2 billion in data center revenue, contrasting sharply with AMD’s $12.6 billion and Intel’s $12.8 billion in 2024. Nvidia’s stronghold over the market is further reinforced by its control over 70% of Taiwan Semiconductor Manufacturing’s advanced chip packaging capacity, as reported by Taiwan-based Economic Daily News. With TSMC’s chip capacity expected to more than double in 2025 and further increase by 80% in 2026, Nvidia is in a position to meet the high demand for its Blackwell AI GPUs.
The demand for Blackwell chips currently outpaces supply, but improvements in the supply chain are expected to enhance Nvidia’s ability to meet orders and deliver growth in upcoming quarters. As such, analyst growth expectations for Nvidia have increased following its fiscal 2025 results, with consensus estimates forecasting at least a 50% growth in revenue and earnings for fiscal 2026.
Nvidia is also focused on boosting its gross margin, which is expected to rise from the low-70% range to the mid-70% range as production of its Blackwell processors ramps up. CFO Colette Kress mentioned during the latest earnings call that the company has multiple opportunities to reduce costs as production increases.
Analysts are optimistic about Nvidia’s performance in the coming year, with 93% of 67 analysts rating the stock as a buy. The 12-month median price target for Nvidia is $175, which would represent a 52% increase from its current trading price. Nvidia’s forward price-to-earnings multiple stands at 26, near its lowest point in the last year, suggesting potential for growth as the fiscal year continues.
