Very few stocks have captured investors’ imagination and hope for the future as well as Nvidia (NVDA).
Nvidia’s high-performance hardware powers the world’s largest tech companies, ushering a new era of modern computing, particularly in AI, machine learning, data analytics, and gaming.
No surprise the world’s leading GPU manufacturer is the best-performing stock of the past three decades, handing its investors a lifetime return of over 320,000%.
Demand for NVDA stock has been so strong that the company implemented its sixth stock split last June. While largely cosmetic, the 10-for-1 split lowered the psychological barrier to ownership.
Despite climbing more than 160% in 2024, Wall Street predicts Nvidia stock could hit new highs in 2025, with most analysts remaining bullish on the stock.
Nvidia stock price predictions for 2025
| Forecaster | Price prediction for 2025 |
| Morgan Stanley | $160 |
| Wedbush | $160 |
| Bernstein Research | $175 |
| Piper Sandler | $175 |
| UBS | $185 |
| Bank of America | $190 |
As the leading supplier of GPUs, Nvidia stands to benefit from the continued growth of data-intensive AI products.
According to Nvidia CEO Jensen Huang, data centers will allocate a whopping $1 trillion over the next four years to upgrade their infrastructure to meet the demands of AI computing.
This largely explains why Nvidia’s data center revenue more than doubled in the third quarter of 2024, reaching more than $30 billion.
Data center revenue adds to the company’s impressive 8.1 million PC discrete GPU shipments in the third quarter.
While this was down from 9.5 million in the second quarter, Nvidia controls 90% of this market. So, when demand picks up again, it’ll go through Nvidia.
Analysts at Morgan Stanley expect Nvidia’s dominance to persist in 2025, giving the stock a price target of $160. The target assumes that NVDA stock will trade at a 42x multiple of the company’s forward earnings for 2025.
Wedbush Securities has also adjusted its forecast for Nvidia to reflect the same $160 price point—up from a previous target of $138.
Wedbush analysts said it’s difficult to justify anything lower given Nvidia’s consistent history of beating revenue forecasts by more than $2 billion.
In the second quarter, Nvidia revenues outpaced expectations by $3.8 billion. Before that, it beat Wall Street’s revenue projections by more than $2 billion for four consecutive quarters.
Bernstein Research believes Nvidia’s share price could reach $175 in the near future on the strength of its Blackwell business. Blackwell GPUs provide advanced AI processing power and are being snatched up by tech giants like Meta, Microsoft, OpenAI, and Google.
In fact, Blackwell GPUs are said to be sold out for the next 12 months, which should give Nvidia a sales cushion of between $5 billion and $8 billion in the fourth quarter.
Investment bank Piper Sandler agrees with Bernstein, giving Nvidia a price target of $175. Piper Sandler thinks Nvidia’s stranglehold of the AI accelerator business will lead the company to squash revenue forecasts in the next two quarters.
“Our viewpoint is rooted in the belief that the overall [total addressable market] for AI accelerators will continue to rise in 2025 by ~$70 billion, and we see NVDA well positioned to capture most of the incremental increase while ceding only a small bit to its merchant chip competitor,” wrote Piper Sandler managing director Harsh Kumar.
UBS has learned not to bet against Nvidia’s revenue growth. The bank recently upped its NVDA price target to $185 in 2025, with analysts calling for higher revenue targets after the company’s fourth-quarter results are announced.
Perhaps the most bullish forecast comes from Bank of America, which expects NVDA stock to reach $190 in 2025. That’s another 46% upside from current levels.
BoA analysts described Nvidia as a “generational opportunity” given the company’s dominance in the AI and gaming sectors. They’ve also shrugged off NVDA’s recent shakiness as a symptom of general market exhaustion following a red-hot year for U.S. stocks.
4 things to watch next year
If Wall Street analysts are correct, Nvidia stock is poised to rise between 23% and 46% in 2025. While this isn’t the growth pace that investors are used to, it’s still a remarkable estimate for a company with a market capitalization of $3.3 trillion.
Looking ahead to 2025, Nvidia’s success hinges on at least four factors:
- Demand for GPUs and AI solutions
- Competition
- Corporate earnings
- Investor sentiment
Demand for GPUs and AI solutions
Nvidia became a household name seemingly overnight because its high-performance chips are at the heart of transformative technologies, such as generative AI, machine learning, and autonomous vehicles.
Nvidia’s technology is also used for data center and cloud computing operations, as well as metaverse and gaming technologies.
As these emerging technologies continue to take off, demand for Nvidia chips is expected to rise.
Research firm Omdia estimates that 43% of global server spending in 2024 went to Nvidia. Microsoft was the largest customer, spending a staggering $31 billion to acquire 485,000 Nvidia chips for its cloud and data center operations.
Nvidia’s other large customers include Microsoft, Google parent Alphabet, Meta, and Tesla.
Analysts say Nvidia’s Blackwell GPU is an “exponential leap forward” thanks to its faster connectivity, higher bandwidth memory, and faster data processing speeds.
“Both Hopper and Blackwell systems have certain supply constraints, and the demand for Blackwell is expected to exceed supply for several quarters in fiscal 2026,” Nvidia chief financial officer Colette Kress told investors during the company’s third-quarter earnings report.
Competition
So far, no company has managed to outperform Nvidia in terms of data center GPU sales, but that doesn’t mean competition isn’t heating up.
The company’s biggest competitors span multiple industries, including GPUs, AI hardware, data, and autonomous technologies.
Companies such as Broadcom and Marvell Technology have talked about the huge potential of their ASIC business. According to them, business clients are looking for cheaper ways to fuel their AI processing needs—and they intend to fill that void.
Broadcom said its addressable market for AI chips could reach $90 billion by 2027—and that’s just based on what three of its customers are doing.
Specialized AI chipmakers like Graphcore, Cerebras, and SambaNova are also trying to compete with Nvidia around AI training applications.
Beyond these emerging competitors, Nvidia also faces direct competition from major players like Advanced Micro Devices (AMD), Intel (INTC), Qualcomm (QCOM), and Amazon (AMZN).
Corporate earnings
Quarterly financial statements are expected to play a major role in Nvidia’s price performance next year. Nvidia continues to be a cash cow, generating revenue and profits that exceed Wall Street’s expectations.
Nvidia has experienced remarkable growth over the last two years. In its fiscal 2023, the company generated $26.97 billion in revenue, marking a slight increase compared to the previous year.
But in fiscal 2024, the company finally reached escape velocity, with revenues surging nearly 126% to $60.92 billion. The company’s operating income rose by 311% and net income was up 286% year-over-year.
This growth is accelerating, too. In its most recent quarter, Nvidia generated $35.1 billion in revenue, marking a 94% year-over-year gain. Management told investors to expect revenues of around $37.5 billion in the fourth quarter.
Investors are likely to be encouraged by Nvidia’s ability to consistently outperform revenue and profit forecasts, but that could become harder to do once the company reaches a certain maturation point.
Investor sentiment
Nvidia is part of the “Magnificent Seven” tech companies that have an oversized impact on the U.S. stock market.
Nvidia’s large market cap, weighting in the S&P 500, and leading position in the AI and GPU industries give it a prominent role in shaping investor perception about the direction of the stock market.
In addition to influencing other stocks, Nvidia’s performance can also be tied to investor sentiment.
Investor sentiment is heavily influenced by economic conditions, Federal Reserve policy, geopolitical tensions, and perceived demand for emerging technologies.
The Fed gave investors a scare in December when it said inflationary risks would prevent aggressive rate cuts in 2025. According to the central bank’s latest projections, no more than two rate cuts are expected next year.
The good news is that the economy isn’t showing any signs of recession yet, and the incoming Trump administration is considered to be very business-friendly.