Tech Corner: NVDA Core of AI Trade
•March 7, 2026
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Why It Matters
Nvidia’s dominant AI infrastructure position and strong earnings validate its role as a growth engine for the tech sector, but concentration and geopolitical risks could temper investor enthusiasm.
Key Takeaways
- •Nvidia's Q4 2025 revenue jumped 73% YoY to $68.1B.
- •Data center segment grew 75% YoY, driven by Blackwell GPUs.
- •Forward PE of 22x vs 56% EBITDA growth suggests cheap valuation.
- •Revenue concentration: two hyperscalers account for 36% of sales.
- •Technical support levels at $170, secondary at $160 indicate near‑term weakness.
Summary
George Tillis of the Schwab Network opened the segment by highlighting Nvidia’s latest earnings beat, noting a 73% year‑over‑year revenue surge to $68.1 billion in Q4 2025 and earnings of $162 per share, the highest in the company’s history. The report underscored the data‑center business as the primary growth engine, with a 75% YoY increase driven by unprecedented demand for the new Blackwell GPU family, while the graphics segment remained a steady contributor.
The analysis detailed Nvidia’s financial health: gross margins at a 12‑month average of 71.1%, net‑income margin of 55.6%, and a forward price‑to‑earnings multiple of roughly 22× against a 56% EBITDA growth rate, yielding a sub‑0.5 PEG that the host called “still cheap.” A $500 billion pipeline for the upcoming Rubin platform through 2026 and a $78 billion revenue outlook for the next quarter reinforced the company’s bullish outlook, even as export restrictions to China trimmed regional sales.
Tillis quoted management describing Blackwell demand as “off the charts” and highlighted Nvidia’s integrated platform strategy—hardware, software, and AI libraries—that differentiates it from rivals such as AMD, Intel, Broadcom, and Google’s TPUs. The host also pointed to the company’s strong balance sheet, free‑cash‑flow generation, and R&D intensity as pillars supporting its market‑dominant position.
The segment concluded that while Nvidia’s valuation appears attractive relative to growth, investors must weigh concentration risk—two hyperscalers represent 36% of revenue—potential AI‑spending slowdowns, and geopolitical headwinds. Technically, the stock trades above its 200‑day moving average but below the 20‑ and 50‑day averages, with $170 as primary support and $160 as secondary, suggesting near‑term price weakness despite a bullish intermediate trend.
Original Description
You know the name, but do you know everything about Nvidia's (NVDA) core businesses? George Tsilis turns to the key drivers behind the Mag 7 giant's substantial profits. He adds that Nvidia's stock is considered cheap on a forward basis despite its gargantuan $4.4 trillion market cap. That said, it faces rising competition and investor fears of an AI bubble as headwinds. George later takes investors through his technical analysis for Nvidia.
See George's prior coverage on Nvidia here: https://youtu.be/eLzcojQ0vRI
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