Nvidia: A Most Curious Case

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Now, these so-called “Magnificent Seven” – Nvidia, Alphabet, Apple, Microsoft, Amazon, Meta, and Tesla – they’re a bit like a gaggle of greedy geese, aren’t they? Hogging a third of the entire S&P 500, flapping about and demanding attention. A rather alarming concentration of power, if you ask me, and I usually do.

As of mid-February, even these plump geese were looking a bit ruffled, down more than the S&P 500 itself. Microsoft, poor thing, was wobbling about like a jelly. And those Amazon fellows, well, they seem to be throwing money at “artificial intelligence” as if it were confetti. A terribly wasteful habit.

But Nvidia…ah, Nvidia. That’s where the real fun begins. They seem to have a knack for turning base metals into glittering gold. Let’s have a peek at why they might just remain the most…robust…of this peculiar flock in 2026.

Nvidia’s Blowout Results (or, How They Swallowed the Profits)

On February 25th, Nvidia presented its earnings, and it was a sight to behold. A record $215.94 billion in revenue! More than 55% of that transformed into a rather hefty $120.07 billion in net income. They even managed to squirrel away $96.58 billion in free cash flow. Enough to buy a small country, I suspect, or at least a very large collection of rubber ducks.

They’re trading at 38.1 times earnings and 47.4 times FCF. Expensive? Perhaps. But consider this: they grew earnings by a whopping 66.7% year over year and are predicting even more growth. A first-quarter revenue increase of 76.9%? It’s almost…unseemly. Like a particularly greedy goblin finding a mountain of sweets.

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Setting the Stage for Sustained Growth (or, The Ever-Hungry Machine)

It’s all very well growing rapidly when you’re a tiny sprout, but Nvidia is now a monstrous oak. It requires an awful lot of feeding to keep it growing. They’re terribly reliant on these “hyperscalers” – Amazon, Google, the lot – constantly throwing money at data centers. A rather precarious position, if you ask me.

They unveiled this “Blackwell” thing in March 2024. They could have rested on their laurels, you see, but no. Because Nvidia generates so much cash, they can afford to spend it on…well, more Nvidia. A self-perpetuating cycle of profit and innovation. A bit like a particularly industrious spider spinning an ever-expanding web.

Then there’s this “Rubin” platform, with six different chips working together. They’re building AI “supercomputers” tailored for these mega-data centers. It’s all rather complicated, but the gist is this: more power, more control, more profit. A perfectly predictable outcome, really.

Capitalizing on Agentic AI (or, The Rise of the Thinking Machines)

Nvidia’s growth is…impressive, let’s say. But it still depends on those hyperscalers. Thankfully, they’re starting to attract new customers – Anthropic, OpenAI, Groq. And Nvidia is throwing money at them. A $10 billion investment in Anthropic, and rumors of $30 billion for OpenAI. It’s a bit like bribing the king to secure a monopoly, wouldn’t you say?

This “agentic AI” business is quite the buzz. Companies building these internal “agents” will need more computing power, which means more demand for Nvidia’s chips. It’s a clever little scheme, really. A beautifully constructed pyramid of profit.

Nvidia isn’t just the bedrock of generative AI; it’s the foundation for everything that comes next. It’s one of the best ways to invest in AI without having to pick a winner in a crowded field. A safe bet, you might say. Though, in my experience, there’s no such thing.

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2026-03-04 01:03