Despite Believing the Opportune Moment for Purchasing Nvidia May Have Passed, This Key Rationale Suggests There's Still a Chance.
Nvidia, the leading supplier of graphics processing units (GPUs) in the data center market, has seen significant financial growth in its data center business. The company's stock has skyrocketed over 1,100% since the start of 2023, outperforming the S&P 500's gain in the same period.
This growth can be attributed to Nvidia's stronghold in the data center GPU market, which is expected to significantly benefit from its growth. According to Grand View Research, the global data center GPU market is estimated to have a compound annual growth rate (CAGR) of around 35% from 2025 to 2033.
The data center GPU market growth is driven by the high demand for AI-driven computing and data center acceleration that GPUs primarily facilitate. AI adoption is projected to increase the importance of data centers, as they power AI workloads such as training, deploying, and scaling.
Nvidia commands around a 92% market share in the data center GPU market, further solidifying its position as the main supplier in this sector.
The growth rate of the data center GPU market is significantly higher than the general-purpose server market, which is forecasted to grow at a CAGR of 6.3% from 2025 to 2033. However, a closely related figure is available for the broader AI Data Center Power Consumption market, which includes GPU-based power usage and is projected to grow at a CAGR of 18.19% from 2025 to 2033. This figure is a strong indicator of rapid growth driven in part by GPU demand in data centers focused on AI workloads.
Given this high demand and the growth trajectory, it is reasonable to estimate that the CAGR for the global data center GPU market will be closer to or potentially higher than the 18.19% CAGR seen in AI data center power consumption.
In its fiscal year first quarter (ended April 27), Nvidia's data center revenue increased 73% year over year to $39.1 billion, emphasizing the financial growth of the company's data center business. This growth is a focus for investors who are keen on the company's future prospects.
In summary, the global data center GPU market is expected to experience a strong growth trajectory over the period from 2025 to 2033, driven by AI and high-performance computing demands. Nvidia, with its dominance in the market, is well-positioned to capitalize on this growth.
Nvidia's financial growth in its data center business is primarily due to its strong position in the data center GPU market, which is projected to grow at a CAGR of around 35% from 2025 to 2033, driven by AI-driven computing and data center acceleration. This high demand for GPUs is a focus for investors, as they see potential in the company's future prospects. Investing in Nvidia's stock could be an opportunity to profit from the expected growth in the data center GPU market. The company's revenue from its data center business significantly increased in its fiscal year first quarter, with a 73% year over year growth, reaching $39.1 billion. Furthermore, the broader AI Data Center Power Consumption market, which includes GPU-based power usage, is projected to grow at a CAGR of 18.19% from 2025 to 2033, suggesting that the global data center GPU market's growth rate could be closer to or potentially higher than this figure.
