NVIDIA’s Amazing Run Isn’t Over yetNVDA) has been on a stunning run since it touched 52-week lows earlier in February. The company has been expanding into several high growth markets, whereas it core business has been growing strongly as well.
That impressive growth may have just begun.
Multiple factors driving future growthNVIDIA’s GPU technology is playing a key role in multiplying its revenue, as the company’s total revenue surged 24% over the previous quarter. That was comprised of a 25% surge in the company’s core GPU business, mainly due to strength in datacenters as well as GeForce gaming GPU sales.
Revenue generated from its newer Tegra processor business escalated 30% year-over-year to $166 million, mainly because of a 68% surge in automotive sales.
Most significantly, on the back of new partnerships as well as its advanced Drive PX self-driving car technology, the company is moving on the right track to conquer the multi-billion dollar market for advanced driver assistance systems.
Throughout the prior few months, the company made collaborative contracts with TomTom for driverless-car mapping as well as with Baidu Inc (BIDU) for a cloud-connected, artificial intelligence based self-driving car platform.
These initiatives will allow NVIDIA to combine its existing Drive PX computing platform with TomTom’s approximately 74,000 miles of HD maps.
Furthermore, the partnership will speed up support for real-time in-vehicle localization and mapping for driving on the road.
Image by / c1.staticflickr.com
Apart from this, NVIDIA is making two new graphics cards designed for gaming oriented PCs. The two graphics cards are GeForce GTX 1050 Ti and GTX 1050.
The company has made a smart move by unveiling these two graphics cards, as both the graphics cards are designed mainly for people those who can’t afford to buy expensive graphics cards. GTX 1050 Ti and GTX 1050 will be priced at just $149 and $119, respectively.
The company has already launched high-end as well as mainstream graphics cards, and with the launch of these low-end cards, the company will now have a total control on the graphics card industry.
Tailwinds ensure further upside existsWhile NVIDIA may have rallied strongly over the past few months, I still think the stock has considerably upside to offer.
Given the aforementioned tailwinds, I expect NVIDIA to continue moving higher going forward.
Published on Oct 12, 2016By Prudent Investor