Nvidia’s Potential to Rival AWS

Nvidia, known for its graphics processing units (GPUs), has seen a significant increase in revenue, moving from $7.1 billion in Q1 2024 to $22.1 billion Q4 2024. This growth is primarily driven by the company’s data center business. The rise of AI and large language models has coincided with an explosion in the use of GPUs, positioning Nvidia in the right place at the right time.

There are parallels between Nvidia and Amazon Web Services (AWS). Both companies’ core businesses emerged unexpectedly, and both have experienced first market advantage. However, as AWS’s growth begins to slow down, Nvidia’s takes off. The question is whether Nvidia can sustain this growth to become a long-term revenue powerhouse like AWS.

Nvidia anticipates $24 billion worth of revenue in its current quarter (Q1 FY25), expecting to post growth of around 234% compared to its year-ago first quarter. Despite the astronomical growth, Nvidia’s other businesses are much smaller revenue generators growing at a slower pace than the GPU data center business.

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