Nvidia: The Future Of Gaming, AI And Self-Driving Cars

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Summary

The core gaming, AI and self-driving car markets of Nvidia are growing fast.

The financials of the company are healthy, however the stock is relatively expensive.

The company has the potential to lead the disruption in many industries.

Nvidia (NASDAQ: NVDA) is very well positioned in its Gaming, Professional Visualization, Datacenter and Automotive markets. The markets the company focuses on in the future are fast growing markets with high potential. From the financial perspective, the company is very healthy. However, the valuation is expensive and Nvidia must execute its strategy well in order to justify the high valuation. Due to the long lead times of the complex GPU development, it can have a mismatch in GPU supply and demand. The company has the potential to grow further in the next 5-10 years and can lead the disruption in many industries.

Business Overview

Nvidia is a technology company, which solves some of the most complex problems in computing and is strategically well-positioned in very exiting markets. It reports revenues in four key market segments: Gaming, Professional Visualization, Datacenter and Automotive.

In the gaming segment, they are enhancing the gaming experience by improving the visual quality of graphics and enabling gamers to play together on the internet. They lay the ground for the biggest gaming growth drivers, such as the eSports, which has now a user base over 350 million people.

The professional visualization enables companies to design and manufacture products efficiently and to create highly realistic digital content. As more and more companies are using VR in their operations, the demand for the professional grade GPUs Nvidia develops is increasing.

In the data center market, Nvidia supplies all the major cloud providers with its GPUs. These high-performance GPUs enable thousands of Artifical Intelligence (AI) developers to rent computing resources by the hour and test their apps, models and services in order to disrupt many established industries.

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