After a Blowout Quarter, Is NVIDIA Still a Buy?

As expected, NVIDIA’s (NVDA) quarterly report was terrific...again. It seems like the company has a habit of delivering stunning quarters, which isn’t surprising given that it has dominating presence in many industries. Obviously, shares of NVIDIA jumped considerably after it reported its earnings. With the market stabilizing, I think it can move higher.

NVIDIA’s Drive PX 2 Platform

NVIDIA performed very well in 2015. The company holds a leading position in the graphics card market and commands around 80 percent of market share as compared to its chief rival Advanced Micro Devices’ 20 percent market share.

Despite being leader in the graphics card market, NVIDIA is planning to focus on autonomous car market.
With time, the automobile market is heading in the direction of self-driving cars. According to IHS Automotive, Google has already spewed around $60 million into its autonomous vehicle research and analysis.

Since 2009, Google has been analysing self-driving cars, and its vehicles have already tormented 1 million miles of autonomous driving. At present, the company has two different types of autonomous cars, comprising all variants of Lexus SUVs as well as new self-driving cars that the company’s manufactured from the ground up. Both the types of vehicle are efficiently performing and have been awarded self-driving certifications in Texas, California, and Washington.

Other than Google, it is likely that Tesla is the only company that talks nearly much about the autonomous cars. Elon Musk Tesla’s already has an Autopilot facility on its Model S that can sense lane changes, steer the car, and automatically change speed regarding the traffic movement.

On the other hand, NVIDIA is well known for its mobile graphics processor and graphics card, but it is evolving as a self-driving vehicle player mainly due to its Drive PX platform. The software is coupled with a powerful PC, attached in the trunk of the car, that processes data in real-time to calculate the vehicle’s surrounding and the space from adjacent cars, recognize pedestrians, and govern the vehicle.

Recently, at the 2016 Consumer Electronics Show, NVIDIA launched the latest version of its self-driving system, the Drive PX 2 Platform. The concept of self-driving cars might prove to be a successful concept in the long-term, but there are little glitches that could strangle autonomous vehicle progress in the near term.


NVIDIA’s has dominating presence in multiple markets and it is also expanding its wings into other fast-growing industries. Autonomous car market is one such industry. NVIDIA has already gained strong foothold into the market and investors can expect it to continue growing. Going forward, NVIDIA has many growth drivers and the latest quarterly results, I think it can continue moving higher.
Published on Feb 19, 2016
By Akshansh Gandhi

Copyrighted 2020. Content published with author's permission.

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