NVIDIA, the year coming next year will be turbulent 🤔🧐

One of the problems with getting to the top is that often there's nowhere else but to fall.
　US semiconductor giant NVIDIA has continued rapid growth over the past year and a half, and definitely stood at the top of both the booming artificial intelligence (AI) market and the stock market. In the financial results for the fiscal year ending 8/10 (3rd quarter) announced on the afternoon of the 20th, annual sales broke through the 100 billion dollar (approximately 15 trillion500 billion yen) mark for the first time. That's more than double what it was a year ago. The total market value is 3 trillion 600 billion dollars, which exceeds the US Apple by 100 billion dollars or more.

That last point is particularly symbolic. This is because the enthusiasm surrounding NVIDIA image processing semiconductors (GPUs) for data centers has surpassed the excitement when the new “iPhone (iPhone)” was released in the past. It's not all good, though. It will continue to be difficult to fully meet the expectations that have been raised to become the most valuable company in the world. NVIDIA's financial results for the fiscal year ending August to October surpassed Wall Street's expectations in every category, and the outlook for the November-January fiscal year was similar. However, the difference between company predictions and market consensus predictions was the smallest since last May, when the company's AI business began expanding, and NVIDIA was sold due to overtime transactions after financial results were announced.

Although NVIDIA is still growing rapidly, its speed has slowed compared to before, and the question of how investors should evaluate the company remains. Sales for the August-October fiscal year were 35.1 billion dollars, up 94% from the same period last year, and it was the first time in five quarters that the sales growth rate did not reach 3 digits. The company estimates sales for the November-January fiscal year to be 37.5 billion dollars, up 70% from the same period last year.
　According to this forecast,The first mass production shipment of the next-generation AI semiconductor “Blackwell,” which was announced by NVIDIA in March, has been factored in. However, since the increase in sales from the August/10 fiscal year is only 2.4 billion dollars, there remains uncertainty about how quickly Blackwell can generate large new sales.In the question and answer session of NVIDIA's financial results briefing held on the 20th, the focus was on the shipping period of Blackwell.

NVIDIA CEO Jensen Huang said, “Demand for Blackwell is extremely strong.” Afterwards, he said again that the company presents forecasts on a quarterly basis.
　Expectations for Blackwell are high. According to analysts' consensus forecasts compiled by Visible Alpha, sales of the same product series will be 62.6 billion dollars in the fiscal year ending 2026/1, and are expected to be 97 billion dollars or more in the next fiscal year. It should be noted that even the figure of 62 billion dollars is larger than the annual sales of any other semiconductor company in the world, with the exception of Taiwan Semiconductor Manufacturing (TSMC), which is NVIDIA's main production partner.

Such a lofty goal is attainable. In particular, if major US technology companies that are major customers of NVIDIA and have plenty of funds continue to spend as shown at the most recent quarterly financial results briefing, the probability will increase. According to estimates by Visible Alpha, Microsoft, Amazon.com, Meta Platforms, and Google parent company Alphabet are expected to invest a total of 242 billion dollars or more in capital investment this year, and an additional 285 billion dollars next year.
　However, the future of such investments will depend on how quickly major tech customers adopt generative AI services. Also, strict requirements are required in order to make the most of the NVIDIA system, and whether major tech companies can construct data centers corresponding to them and supply sufficient power is also an issue. A lot of things have worked out for NVIDIA over the past year. More things need to go well in the next year.

end