Could Nvidia become the first $10 trillion company?

0 2 4 minutes read

Could Nvidia become the first trillion company?

Nvidia reached $4 trillion and became the world’s largest company this year.
The company has seen its profits and market value increase due to demand for its AI products.
10 stocks we like better than Nvidia ›

Nvidia (NASDAQ:NVDA) hit a major milestone this year – and I’m not talking about launching a new artificial intelligence (AI) product. The AI giant saw its market value surpass $4 trillion to make it the largest company in the world – Nvidia surpassed Microsoft And Appletwo players who have each occupied this position in recent years.

Since then, Nvidia has retained the top spot and its market value has climbed to $5 trillion before returning to levels of around $4.3 trillion. The reason for this market capitalization gain is clear: investors see Nvidia as the ultimate stock to buy to benefit from the AI boom. Nvidia makes the world’s #1 graphics processing units (GPUs), or chips that power the development and use of AI. And the company has expanded its offerings to include a wide range of related products and services.

Considering all of this, could Nvidia become the first $10 trillion company? Let’s find out.

Image source: Getty Images.

Before we answer that question, let’s take a quick look at this incredible growth story. Nvidia has focused for several years on selling GPUs to video game companies. But when talk of AI began circulating around a decade ago, Nvidia knew it could play an important role and jumped at the opportunity. The company designed GPUs for this powerful new technology, building its reputation as an expert and leader in the field.

All of this fueled massive revenue growth, with sales growing by double and triple digits as the AI boom progressed. Customers flocked to Nvidia for chips and associated tools to power their large language models, and Nvidia, seeing the potential ahead, committed to innovating every year to satisfy the need for speed and efficiency. This commitment to innovation is what has allowed Nvidia – and should continue to do so – to stay ahead of the rest.

Now let’s look at our question: Could Nvidia become the first company to reach $10 trillion? To reach that level, Nvidia stock would have to rise 128% to around $411, which seems like a reasonable feat for this company over, say, a five-year period. (Nvidia has soared 1,200% over the past five years.) But it’s important to ask whether Nvidia’s growth rate would support such a price.

We can gather clues by looking at Nvidia’s price-to-sales ratio. Today the company trades at 23 times trailing 12-month sales, but over the past year that ratio has most often been around 25 or more. Nvidia’s sales reached $130 billion in the last fiscal year, and analysts are forecasting levels of $213 billion for the current fiscal year and $316 billion for the next fiscal year (fiscal year 2027). This suggests year-over-year growth of 63% in this fiscal year and 48% in the next fiscal year.

Now consider the example of $400 billion in annual revenue by the end of the decade. This represents growth of just 27% over the projected figure for fiscal 2027 – a much lower growth rate than what Nvidia has seen in recent years. Nvidia could reach a market value of $10 trillion in this example, because at that revenue level the company’s P/S ratio would be 25.

This means that, mathematically, it is possible for Nvidia’s market value to reach these levels. But does it have the activity necessary to fuel such revenue gains?

I’m optimistic, and here’s why: Nvidia is the leader in the GPU market and is innovating to secure its position. Meanwhile, we are currently in a major stage of infrastructure ramp-up, meaning large cloud service providers are expanding their data centers to meet the growing demand for AI. And the players like Metaplatformsaiming to train models in-house and develop their own AI programs, also looks directly to Nvidia for its products. In fact, Nvidia predicts that spending on AI infrastructure could reach as much as $4 trillion over the next five years.

Nvidia, which already works closely with these deep-pocketed customers, could be one of the biggest winners from this move. And all of this could lead this big AI company to a major new milestone: $10 trillion in market value by 2030.

Before buying Nvidia stock, consider this:

THE Motley Fool Stock Advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now…and Nvidia wasn’t one of them. The 10 selected stocks could produce monster returns in the years to come.

Consider when Netflix made this list on December 17, 2004…if you had invested $1,000 at the time of our recommendation, you would have $513,353!* Or when Nvidia made this list on April 15, 2005…if you had invested $1,000 at the time of our recommendation, you would have $1,072,908!*

Now it’s worth noting Equity Advisor the total average return is 965% — an overwhelming market outperformance compared to the 193% for the S&P 500. Don’t miss the latest top 10, available with Equity Advisorand join an investor community built by individual investors for individual investors.

See the 10 values »

*Stock Advisor returns December 8, 2025

Adria Cimino has no position in any of the stocks mentioned. The Motley Fool holds positions and recommends Apple, Meta Platforms, Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Could Nvidia become the first $10 trillion company? was originally published by The Motley Fool

ahsan65@gmail.com2 weeks ago

0 2 4 minutes read