We recently released an article titled 10 Stocks Everyone’s Talking About As AI Investments Keep Growing. One of the highlighted companies is NVIDIA Corporation (NASDAQ:NVDA), which has been a focal point in recent discussions among analysts.
Stacy Rasgon, who serves as the senior semiconductor analyst at Bernstein, recently shared insights regarding the $100 billion deal between NVIDIA Corp (NASDAQ:NVDA) and OpenAI. He highlighted that this agreement illustrates a significant “shortage” of computing resources, with many customers securing their place in line ahead of time.
“One of the key themes emerging seems to be a lack of available computing power. Everyone involved appears to be in a race for compute resources. I believe that is a contributing factor, and Jensen has projected some substantial figures for infrastructure spending by the decade’s close. I think his estimates were around three to four trillion — who knows how accurate that is — but I am confident it is significant. There is also the interesting power dilemma. I believe clients are investing in power ahead of these projects well in advance because the existing power infrastructure is inadequate; it needs to be established beforehand. There’s been considerable attention on whether power might actually become the main constraint over time, even more than compute resources.”
The current surge in AI investment is driven by expenditures from major technology firms, with Nvidia emerging as the primary beneficiary. In the second quarter of FY2026, three of its direct customers made up 23%, 19%, and 14% of NVDA’s accounts receivable. Nearly all of the company’s revenue is derived from AI infrastructure spending. In the latest reporting period, $41.3 billion out of $46.7 billion in revenue originated from these specific clients. If these leading corporations begin to reduce their spending due to insufficient ROI, Nvidia could face significant financial challenges. Any signs of a decrease in capital expenditure could cause NVDA’s stock price to react swiftly.
Baird Chautauqua International and Global Growth Fund commented on NVIDIA Corporation (NASDAQ:NVDA) in their second quarter 2025 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) has reported first-quarter results that were exceptionally strong. The company took a write-down for datacenter products meant for China and eliminated any anticipated contributions from China in their guidance due to the recently implemented export restrictions. The demand commentary excluding China was extremely positive—Nvidia is surpassing expectations despite facing supply constraints and is significantly outperforming competing ASIC products. We have maintained an underweight position in Nvidia compared to the benchmark, which was up 46% during the quarter, owing to our concerns over the potential for overcapacity that the intense AI datacenter investments may cause, which has yet to manifest.”
