Nvidia Corp. (NVDA) has reported a surprising growth outlook, projecting a revenue increase of 70% by fiscal 2028, significantly higher than the 45% analysts previously expected. This adjustment indicates potential annual sales could rise from approximately $580 billion to $680 billion, representing about $100 billion in additional revenue.
However, Nvidia anticipates rising memory costs to pressure its gross margins throughout the latter half of the year, shifting attention from its sales potential to the costs of essential components. This situation emphasizes the importance of suppliers, particularly in areas like memory and optical networking, as they gain leverage in pricing amidst the growing demand for AI infrastructure.
The shift in the AI landscape has highlighted various supply chain bottlenecks in recent years, including shortages in compute power, servers, cooling systems, energy, and now, memory and networking. Investors are advised to focus on companies controlling these critical components, as they possess the potential for significant revenue growth alongside Nvidia’s expansion.
5 Stocks Our Experts Predict Could Double In the Next Year
By submitting your email, you'll also get a free pivot & flow membership. A free daily market overview. You can unsubscribe at any time.
