Nvidia's stock is surging, driven by the continued boom in artificial intelligence. Loop Capital predicts the chipmaker's market value could reach $6 trillion. This surge is fuelled by strong demand for AI chips and systems, particularly from hyperscalers like Amazon, Microsoft, and Google, whose spending on Gen-AI and AI accelerators could hit $2 trillion by 2028.
Nvidia's CEO, Jensen Huang, highlighted robotics as a key growth area. Loop Capital's analyst, Ananda Baruah, raised the price target to $250 per share, based on expectations that next-generation Blackwell chips will be in full production by October. This target reflects a belief that hyperscalers are shifting away from CPU-based compute, aiming for 50-60% non-CPU usage by cycle's end, up from 12% at the start of the year. Reasoning models are proving more token-intensive, and demand for inferencing and AI factories is rapidly increasing.
Nvidia is also building a parallel AI-focused cloud ecosystem to challenge Amazon, Microsoft, and Google, including its DGX Cloud service and investments in AI-focused cloud companies. This move signals Nvidia's shift towards recurring revenue streams in cloud services, beyond just selling chips.
