Why NVIDIA at $140 Is Not the Peak
Calling a top right now is like calling the end of the internet buildout in 1998. We're in the early innings of the largest infrastructure cycle in history.
June 2024The Hyperscalers Are Just Getting Started
Microsoft, Google, Amazon, and Meta are in a full-on arms race to build AI-native cloud infrastructure. Their collective capital spending is already surging.
- Microsoft guided to "materially higher" Azure infrastructure CapEx in fiscal 2025
- Google Cloud is ramping aggressively across all regions
- Amazon is pouring billions into custom chips while still buying NVIDIA GPUs
- Meta going "all in" with hundreds of thousands of GPU equivalents
Blackwell Changes the Game — Again
NVIDIA didn't just rest on the Hopper laurels. The Blackwell architecture announced at GTC is a monster leap: roughly 4x the training performance and 30x the inference performance of H100.
The Grace-Blackwell superchip pairs NVIDIA's CPU with its GPU in a tightly integrated package that hyperscalers love for efficiency.
This isn't a one-quarter story. Blackwell will be the workhorse platform through 2026 and beyond.
The Competition? Still Playing Catch-Up
AMD's MI300X looks solid on paper. Intel's Gaudi 3 is cheaper per token on certain inference workloads. The hyperscalers' custom silicon efforts are real.
But here's the reality check: CUDA. NVIDIA's software ecosystem is a decade ahead, and the switching costs for AI developers are enormous.
The network effects are brutal — more developers → better libraries → more performance → more adoption → even stronger moat.
Valuation: Expensive, But Worth It
Yes, the forward P/E is north of 40x. But when a company is growing revenue 100%+ year-over-year with 60–70% gross margins, the multiple makes sense.
The rule of 40 (growth + margin) is blowing past 150. Compare that to any other mega-cap tech name and NVIDIA still screens reasonably.
$140 feels like a milestone, not a peak. This ride still has plenty of runway left.
Vector Ridge is long NVIDIA. This article represents our views at the time of publication and should not be considered investment advice. Past performance does not guarantee future results.