NVIDIA Corporation (NVDA)
Fair ValueFundamental
73
Price
$229.28
Market Cap
$5.54T
Part 1 · What the company is worth
Overview
NVIDIA designs the processors that do the heavy arithmetic behind artificial intelligence, computer graphics and scientific computing. It does not own factories: it designs the chips and the software that runs on them, and has them manufactured by outside foundries. What began as a company selling graphics cards to gamers now sells complete systems — chips, networking and software — to the operators of the world's largest data centres, who use them to train and run AI models.
How it makes money
Revenue comes from selling hardware, not from subscriptions: NVIDIA books a sale when a customer takes delivery of a chip, a board or a complete server system. Because it designs rather than manufactures, its costs are largely research and foundry capacity, so each additional unit sold at a high price carries a very large margin. Its pricing power rests on being, for now, the only practical supplier of the performance the largest AI workloads require.
Revenue by segment
Chips, networking and systems sold to cloud providers and large enterprises to train and run AI models. This is the business today.
GeForce graphics cards for personal computers and chips for game consoles — the original business, now a small share of the whole.
Workstation graphics for engineers, architects and film studios, plus tools for building simulated environments.
Computing platforms sold to carmakers for assisted and autonomous driving. Small today, with long lead times before revenue appears.
Residual sales to equipment manufacturers that do not belong to the other four lines.
Competitive moat
Switching costs · WideFor nearly twenty years, AI software has been written against CUDA, NVIDIA's programming layer. A competitor can match the silicon and still lose, because moving a research team's accumulated code and tooling to another platform costs months of work. The chips are replaceable; the habits built on top of them are the harder thing to dislodge.
What drives demand
CyclicalDemand follows the investment budgets of a handful of very large technology companies. Those budgets are decided in multi-year cycles and can be cut quickly: the industry has repeatedly gone from shortage to glut within a few quarters. Revenue here is the consequence of someone else's capital spending decision, not of steady end-user consumption.
Key risks
- Revenue concentrated in few buyers — The company states that its revenue is concentrated among a limited number of direct and indirect customers, and that the trend may continue. Losing one of them, or a pause in their spending, is not a marginal event.
- Dependence on outside foundries — NVIDIA owns no fabrication plants and relies on third parties, concentrated in Taiwan, for manufacturing and advanced packaging. Capacity shortfalls or disruption at a supplier translate directly into lost sales.
- Export controls and geopolitics — Government restrictions on selling advanced chips to certain countries have already removed markets from the company, and the rules can change without warning and without compensation.
- Customers building their own chips — The same large customers that buy the most are designing internal alternatives. A buyer that becomes a competitor reduces demand and bargaining power at the same time.
- Demand may not match capacity commitments — The company commits to supply and inventory well before orders are firm. If demand slows after those commitments, it carries the cost of capacity it can no longer sell.
Customer concentration
Top customers account for 36% of revenue
In fiscal 2026 one direct customer alone accounted for 22% of revenue and a second for 14%. A single buyer's change of plan therefore moves the whole company's results.
The case for
Buyers argue that the build-out of AI computing has years left to run, that CUDA keeps customers in place while rivals catch up on hardware, and that margins of this size on revenue growing 65% a year are evidence of pricing power rather than of a passing shortage.
The case against
Sellers fear that a handful of customers are funding almost all of this growth from capital budgets they can cut in a single quarter, that their in-house chip programmes erode both volume and price, and that today's margins assume a scarcity which additional foundry capacity is designed to end.
Written by the editors, published on August 18, 2026
Direct competitors
Who this company fights with for the same customers
Generated on August 22, 2026 with claude-opus-5 — shared with all users
AMD is the only other merchant supplier selling both data-center AI accelerators (Instinct MI series) and discrete gaming graphics cards (Radeon) to the same cloud operators, PC makers and gamers NVIDIA sells to.
Broadcom designs the custom AI accelerators (XPUs) and the Ethernet switching silicon that the largest cloud companies buy instead of NVIDIA GPUs and NVIDIA networking gear for their AI data centers.
Google's TPU line is sold as an alternative to NVIDIA GPUs for training and running AI models, both rented through Google Cloud and, increasingly, placed in customers' own data centres.
Intel competes for the same server and PC sockets with its data-center CPUs, integrated and discrete graphics, and its AI accelerator line, and is named by NVIDIA among its accelerated-computing competitors.
AWS designs its own Trainium and Inferentia chips and rents them to the same AI developers who would otherwise rent NVIDIA GPU capacity in the cloud.
Huawei's Ascend accelerators are the main alternative for Chinese data-centre customers that NVIDIA can no longer serve because of United States export restrictions.
Balance Sheet & Liquidity
Revenue
$302.97B
Trailing 12 months (through 7/26/2026)
Net Income
$192.88B
Trailing 12 months (through 7/26/2026)
Free Cash Flow
$96.68B
Total Equity
$157.29B
Total Liabilities
$49.51B
Current Ratio
4.59
Interest Coverage
426.74
Debt/EBITDA
0.29
Earnings Per Share
Revenue & Net Income
Free Cash Flow
Income Breakdown
Historical statement
Margins over time
Debt over time
How heavy the debt is
Growth grid
Growth — Revenue
Fair Value Estimation
Fair Value
$236.73
Current Price
$229.28
Margin of Safety
+3.1%
Fair Value Range
$153.87 - $319.58
Spread across the valuation methods used, not a statistically calibrated confidence interval.
Estimation Methods
Valuation Metrics
P/E Ratio
28.99
ROE
76.3%
P/B Ratio
24.13
P/FCF
43.51
Gross Margin
74.7%
ROIC
56.3%
Profitability Radar
Value Creation (Economic Moat)
ROIC outlierROIC
56.3%
WACC
16.8%
ROIC − WACC
+39.5 pp
ROIC exceeds the cost of capital — the company is creating value for shareholders.
Fundamental Analysis Criteria
Passed (21)
- EPS shows upward trend
- EPS CAGR 7.60%
- Price CAGR 55.85%
- ROIC 56.3%
- Gross margin 74.7%
- Debt/equity ratio
- Operating margin 65.2%
- Positive free cash flow
- CapEx intensity
- Current ratio
- Interest coverage
- Debt/EBITDA
- Return on tangible assets
- Low reliance on intangibles
- ROE 110.1%
- Revenue growth 5Y 66.9%
- Analyst consensus: 94% buy
- Earnings surprise, average 3.4%
- PEG ratio 0.30
- Share dilution -1.2%
- Net margin trend 63.7% vs 52.4%
Failed (6)
- P/FCF 43.51
- P/B ratio 24.13
- Price below Graham Number
- DCF valuation (Overvalued)
- Earnings quality (operating cash flow / net income) 0.70
- Piotroski F-Score 4/9
Unavailable (1)
- Dividend payout –
Piotroski F-Score
Mixed signals: some areas need attention
Earnings Quality
Moderate: some gap between profits and cash
Share Dilution
Buying back shares. Shareholder friendly
Institutional Holdings
Governance
Executive Team
| Name | Title | Age |
|---|---|---|
| Mr. Jen-Hsun Huang | Co-Founder, CEO & Director | 62 |
| Ms. Colette M. Kress | Executive VP & CFO | 58 |
| Ms. Debora Shoquist | Executive Vice President of Operations | 70 |
| Mr. Timothy S. Teter J.D. | Executive VP, General Counsel & Secretary | 58 |
| Mr. Chris A. Malachowsky | Co-Founder | - |
| Mr. Scott C. Gawel | Chief Accounting Officer | 54 |
| Prof. William J. Dally Ph.D. | Chief Scientist & Senior VP of Research | 64 |
| Mr. Toshiya Hari | Vice President of Investor Relations & Strategic Finance | - |
| Ms. Mylene Mangalindan | Vice President of Corporate Communications | - |
| Ms. Alison Berkley Wagonfeld | Chief Marketing Officer | 54 |
Audit Risk
5
Board Risk
10
Compensation Risk
4
Shareholder Rights Risk
6
Part 2 · The price and when to enter
This part won't tell you whether the company is worth owning: it helps you choose when to buy it, once the fundamentals have convinced you. Inside: technical analysis, potential, historical drawdowns, gamma exposure.
Documents
- View document
Annual Report (10-K)
A yearly overview of the business, its financial results, and the risks it faces.
Filed on 2026-02-25
- View document
Quarterly Report (10-Q)
A snapshot of financial performance for the most recent three-month period.
Filed on 2026-08-26
- View document
Current Report (8-K)
An announcement of a major event, such as a leadership change or big news.
Filed on 2026-09-03
via SEC EDGAR
Income History
via SEC EDGAR
Latest News
Recent headlines for NVDA, sourced from Markets Gazette.
- 13h agoNEGATIVENvidia in calo: i titoli del portafoglio affondano e si valuta l'offerta per Reflection AI
Nvidia's stock has experienced a four-day decline, falling from a record high of $243 to $230, as investor sentiment cools on the artificial intelligence boom. This downturn is exacerbated by struggles within some of its portfolio companies. For instance, SoundHound AI has hit its lowest point since 2014, and Marvell Technologies has seen its stock price drop to $275. This performance raises concerns about the sustainability of Nvidia's valuation and its investment strategy, potentially signaling further downside risk for the tech giant.
- 1d agoPOSITIVENvidia built a $5 trillion company while making employees pay for their own lunch—but they get far more lucrative perks like stock discounts
Nvidia has achieved a market capitalization exceeding $5 trillion, a significant milestone for the tech giant. While employees historically covered their own lunch expenses, the company's robust stock compensation plan has proven to be a far more valuable perk. This strategy, coupled with the company's rapid growth and innovation in AI and semiconductors, has historically rewarded shareholders and employees alike, contributing to its immense valuation and market dominance. The news highlights a unique compensation philosophy that has ultimately aligned employee interests with significant shareholder value creation.
- 1d agoPOSITIVEWhy Nvidia’s stock is dodging the AI credit scare that is crushing Broadcom and Oracle
Nvidia's stock is demonstrating resilience against an 'AI credit scare' that is negatively impacting competitors like Broadcom and Oracle. While all three companies have seen their P/E ratios contract and credit default swap (CDS) spreads widen, Nvidia appears to be largely unaffected by the market's concerns. This divergence suggests that investors perceive Nvidia's business model and future prospects as more robust, potentially due to its dominant position in AI hardware. The market's continued confidence in Nvidia, despite broader sector headwinds, could signal ongoing strength and outperformance.
- 2d agoPOSITIVENvidia and Micron shares bounce as investors get clarity on a key OpenAI matter
Nvidia shares experienced a notable rebound, alongside Micron Technology, following a report that offers a more favorable financial outlook for OpenAI. This clarity on OpenAI's financial health is interpreted positively by investors, suggesting potential upside for key partners and suppliers in the AI ecosystem. The improved sentiment around OpenAI's financial stability could translate into increased investment and demand for the advanced computing hardware and memory solutions provided by Nvidia and Micron, thereby bolstering their respective stock performances.
- 2d agoNEGATIVENvidia: le azioni formano un pattern rischioso, gli esperti avvertono di una bolla IA
Nvidia's stock is facing pressure, trading approximately 5.4% below its yearly high at $230. This downturn is influenced by prominent investors Ray Dalio and Michael Burry warning of a potential AI bubble. Further contributing to the decline are the withdrawal of Firmus's IPO, a neocloud company backed by Nvidia, and investor reactions to OpenAI's recent revenue reports. The failure of Firmus's IPO, due to investor hesitation over its valuation, specifically impacts Nvidia's ecosystem. These factors collectively signal caution for investors in the AI chip giant.
- 3d agoNEGATIVEMicron, Nvidia and AI chip stocks fall as report on OpenAI’s revenue causes ‘undue concern’
AI chip stocks, including Nvidia, experienced a decline following a report suggesting OpenAI's annualized revenue missed expectations. While analysts attribute this to reporting discrepancies rather than a slowdown in AI demand, the market reaction indicates investor sensitivity to perceived revenue shortfalls in key AI players. This event highlights the interconnectedness of the AI ecosystem, where concerns about one major entity can ripple through the supply chain, impacting chip manufacturers reliant on AI growth. Investors are advised to monitor OpenAI's official disclosures and broader AI sector demand indicators.
- 4d agoNEUTRALSpaceX may chase ‘stunning’ AI returns by taking on a lot of debt to buy Nvidia chips
SpaceX is reportedly exploring a massive $40 billion debt-financed acquisition of advanced Nvidia GPUs and related infrastructure. This potential move signals strong demand for Nvidia's cutting-edge AI hardware, suggesting a significant revenue stream for the chipmaker. However, the news also highlights the substantial capital requirements for AI development, potentially impacting SpaceX's financial leverage. For investors, this underscores Nvidia's critical role in the AI boom but also introduces a layer of speculative risk tied to SpaceX's financing capabilities.
- 4d agoNEUTRALSpaceX in Talks to Borrow $40 Billion to Buy Nvidia Chips
SpaceX is reportedly in discussions to secure $40 billion in debt financing, primarily to acquire a substantial volume of AI chips from Nvidia. This potential transaction highlights the immense demand for advanced AI hardware and Nvidia's critical role in supplying it. While the financing itself is a significant financial undertaking for SpaceX, the news directly points to a massive potential order for Nvidia, underscoring its market dominance in the AI chip sector. Investors will monitor the finalization of this deal and its implications for both companies' financial structures and market positions.
via Markets Gazette