From Nasdaq:

Nvidia’s semiconductor chips play a crucial role in AI applications like machine learning and large language models. The company is experiencing high demand for its A100 and H100 chips, driving impressive revenue growth. Nvidia’s software business is also showing promise, with an annualized revenue run rate of $1 billion. Competition from other tech giants may pose a challenge, but Nvidia’s software offerings could help maintain growth and profitability in the long run.

Nvidia’s robust growth in its chip business has been a significant driver of its revenue and profitability. The company’s data center segment saw a 217% annual growth to $47.5 billion in fiscal year 2024. With strong pricing power and market dominance in high-performance GPUs, Nvidia’s gross margin increased to 72.7%. As competition heats up, the company’s software business could provide a high-margin growth opportunity.

While Nvidia faces increasing competition in the GPU space, its software business presents a potential avenue for sustained growth. The company’s software and services offerings reached a $1 billion revenue run rate in Q4, hinting at future expansion beyond semiconductors. Investments in areas like voice-powered AI assistants and robotics could further bolster Nvidia’s position in the AI market.

As Nvidia looks to leverage its software capabilities, opportunities in voice-powered AI assistants and robotics stand out as potential growth areas. Partnerships with companies like SoundHound AI and investments in humanoid robots through Figure AI could drive future revenue growth for Nvidia. The company’s focus on expanding its software offerings could help mitigate challenges in the competitive GPU market.

Investors in Nvidia should consider the company’s innovative approach to expanding beyond semiconductors through software and services. While competition in the GPU space is intensifying, Nvidia’s strategic investments in voice-powered AI assistants and robotics position it for long-term growth. By diversifying its revenue streams, Nvidia could continue to drive value for shareholders in the evolving AI landscape.



Read more at Nasdaq: Nvidia Is Already Making Waves Outside of Semiconductors. Here’s the Company’s Latest Artificial Intelligence (AI) Milestone.