Nvidia Unveils Next-Gen AI Supercomputer Rubin, Cost Per Token Reduced to One-Tenth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 10 2026
0mins
Should l Buy NVDA?
Source: Fool
- Market Leadership: Nvidia's strategy to release new hardware annually, an acceleration from its previous two-year cycle, is underscored by CEO Jensen Huang's remarks on skyrocketing Blackwell GPU sales and sold-out cloud GPUs, indicating robust market demand and sustained growth potential.
- Technological Innovation: The newly launched Rubin platform reduces the cost per token to one-tenth of Blackwell's, which is expected to attract more developers, enhance profitability, and accelerate AI model adoption, further solidifying Nvidia's leadership in the AI sector.
- Chinese Market Opportunity: Although management has not included potential sales to Chinese customers in its guidance, it has instructed its foundry partner to produce H200 chips to meet anticipated high demand, reflecting the company's confidence in the Chinese market and future growth expectations.
- Partnership Expansion: Serve Robotics, utilizing Nvidia's Jetson Orin platform, has expanded its fleet of delivery robots twentyfold in the past year, demonstrating strong synergies with partners like Uber, which propels the application and market penetration of physical AI.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 175.750
Low
200.00
Averages
264.97
High
352.00
Current: 175.750
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is an artificial intelligence (AI) infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. Its segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing and networking platforms and AI solutions and software, and automotive platforms and autonomous and electric vehicle solutions, including software. The Graphics segment includes GeForce GPUs for gaming and personal computers (PCs), and Quadro/NVIDIA RTX GPUs for enterprise workstation graphics. Its technology stack includes the foundational NVIDIA CUDA development platform that runs on all NVIDIA GPUs, as well as hundreds of domain-specific software libraries, frameworks, algorithms, software development kits (SDKs), and application programming interfaces (APIs). Its platforms address four markets, which include Data Center, Gaming, Professional Visualization, and Automotive.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Profitability Improvement: The company reported non-GAAP earnings per share of $1.62, an 82% increase year-over-year, while maintaining an impressive adjusted gross margin of 75.2%, showcasing its strong pricing power and production scale within its hardware ecosystem.
- Optimistic Future Outlook: Management anticipates first-quarter revenue for fiscal 2027 to be approximately $78 billion, indicating that the company's growth in the AI sector is still in its early stages, with the data center business expanding nearly 13 times since fiscal 2023.
- Valuation Outlook Analysis: Despite a current price-to-earnings ratio of about 36, the forward P/E ratio is expected to drop to 21 over the next four quarters, and if the company meets Wall Street's earnings expectations, the stock price could appreciate by 12% over the next year, reaching around $197.
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- Policy Risks: While the opportunities in the Chinese market are significant, uncertainties surrounding government regulations and market access could impact Nvidia's long-term strategic positioning in the region.
- Investment Opportunities: Analysts suggest that despite the high costs associated with re-entering the market, Nvidia could leverage technological innovation and adaptability to capture growth opportunities in China, enhancing its global competitiveness.
- Future Outlook: As demand for AI technology continues to rise in China, Nvidia's market strategy will need to be agile to navigate the complex policy landscape and maximize returns on its investments in the region.
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- Investment Potential: Despite recent downturns, the Vanguard Tech ETF is considered a strong buy for investors looking for significant exposure to the semiconductor sector, particularly given that its top holdings, including Nvidia, Apple, and Microsoft, constitute 44% of the fund.
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- Tech ETF Performance: The Vanguard Information Technology ETF boasts a remarkable 23% average annual return over the past decade, significantly outperforming other 63 ETFs, showcasing its strong performance driven by heavy investments in giants like Nvidia, Apple, and Microsoft.
- Concentration Risk Warning: Despite its stellar performance, the Vanguard Information Technology ETF has declined 11.3% year-to-date, worse than the S&P 500's 7.3% drop, highlighting the concentration risk during sector-wide sell-offs.
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See More
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- Significant Revenue Growth: Nvidia's revenue surged 65% over the past year to $215 billion, reflecting strong demand in the AI sector and its dominant market position, with expectations for continued growth ahead.
- Market Leadership Advantage: As the first company to launch powerful GPUs specifically designed for AI, Nvidia has maintained a competitive edge by annually updating its systems, making it difficult for rivals to catch up.
- Future Revenue Potential: Nvidia CEO Jensen Huang stated in a recent podcast that the company has the potential to reach $3 trillion in revenue in the near future, a prediction based on its ability to drive AI platforms across various industries.
- Diversified Business Expansion: Nvidia is not only focused on the chip market but is also actively entering sectors like healthcare and telecom, leveraging its AI systems to enhance efficiency and innovation, thereby further expanding its revenue opportunities.
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- Defense Contract Stability: Lockheed Martin's defense contracts can last for decades, providing predictable cash flows for shareholders through projects like the F-35 fighter jet, with a record backlog of $194 billion ensuring stable future revenues.
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See More
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- Significant Revenue Growth: Nvidia's revenue in Q4 of fiscal 2026 surged 73% year-over-year to $68.1 billion, primarily driven by its data center segment, which generated $62.3 billion in revenue, up 75% year-over-year.
- Profitability Improvement: The company reported non-GAAP earnings per share of $1.62, an 82% increase year-over-year, while maintaining an impressive adjusted gross margin of 75.2%, showcasing its strong pricing power and production scale within its hardware ecosystem.
- Optimistic Future Outlook: Management anticipates first-quarter revenue for fiscal 2027 to be approximately $78 billion, indicating that the company's growth in the AI sector is still in its early stages, with the data center business expanding nearly 13 times since fiscal 2023.
- Valuation Outlook Analysis: Despite a current price-to-earnings ratio of about 36, the forward P/E ratio is expected to drop to 21 over the next four quarters, and if the company meets Wall Street's earnings expectations, the stock price could appreciate by 12% over the next year, reaching around $197.
See More
Nvidia Reopens Key AI Market in China Amid Risks
- Market Reopening: Nvidia has reopened its operations in China, one of the world's most crucial AI markets, presenting potential for revenue growth despite existing policy risks that complicate the narrative.
- Policy Risks: While the opportunities in the Chinese market are significant, uncertainties surrounding government regulations and market access could impact Nvidia's long-term strategic positioning in the region.
- Investment Opportunities: Analysts suggest that despite the high costs associated with re-entering the market, Nvidia could leverage technological innovation and adaptability to capture growth opportunities in China, enhancing its global competitiveness.
- Future Outlook: As demand for AI technology continues to rise in China, Nvidia's market strategy will need to be agile to navigate the complex policy landscape and maximize returns on its investments in the region.
See More
Vanguard Tech ETF to Split Shares Soon
- Stock Split Announcement: The Vanguard Tech ETF is set to execute an 8-for-1 stock split on April 21, reducing its current share price of $668.70 to below $100, aiming to attract a broader base of investors.
- Underperformance: As of 2026, the Vanguard Tech ETF has declined 11.3% year-to-date, underperforming the S&P 500's 7.3% drop, highlighting the risks associated with concentrated investments in a few stocks amid sector-wide pressures.
- Investment Potential: Despite recent downturns, the Vanguard Tech ETF is considered a strong buy for investors looking for significant exposure to the semiconductor sector, particularly given that its top holdings, including Nvidia, Apple, and Microsoft, constitute 44% of the fund.
- Valuation Appeal: With forward P/E ratios of 21.5 for Microsoft and 19.9 for Nvidia, both below the S&P 500's 20.5, the lower valuations reduce reliance on consistent blowout earnings, potentially appealing to investors concerned about a slowdown in AI spending.
See More
Vanguard Announces Share Splits for Five ETFs
- ETF Share Splits: Vanguard has announced forward share splits for five equity index ETFs effective April 21, which will reduce their share prices from triple digits to below $100, enhancing liquidity and attracting more investors.
- Tech ETF Performance: The Vanguard Information Technology ETF boasts a remarkable 23% average annual return over the past decade, significantly outperforming other 63 ETFs, showcasing its strong performance driven by heavy investments in giants like Nvidia, Apple, and Microsoft.
- Concentration Risk Warning: Despite its stellar performance, the Vanguard Information Technology ETF has declined 11.3% year-to-date, worse than the S&P 500's 7.3% drop, highlighting the concentration risk during sector-wide sell-offs.
- Valuation Appeal: With Microsoft's and Nvidia's forward P/E ratios now at 21.5 and 19.9, respectively, below the S&P 500's 20.5, investors may find the Vanguard Information Technology ETF increasingly attractive amid concerns over potential slowdowns in AI spending.
See More
Nvidia's Revenue Growth Surges Amid AI Boom
- Significant Revenue Growth: Nvidia's revenue surged 65% over the past year to $215 billion, reflecting strong demand in the AI sector and its dominant market position, with expectations for continued growth ahead.
- Market Leadership Advantage: As the first company to launch powerful GPUs specifically designed for AI, Nvidia has maintained a competitive edge by annually updating its systems, making it difficult for rivals to catch up.
- Future Revenue Potential: Nvidia CEO Jensen Huang stated in a recent podcast that the company has the potential to reach $3 trillion in revenue in the near future, a prediction based on its ability to drive AI platforms across various industries.
- Diversified Business Expansion: Nvidia is not only focused on the chip market but is also actively entering sectors like healthcare and telecom, leveraging its AI systems to enhance efficiency and innovation, thereby further expanding its revenue opportunities.
See More
Investment Opportunities in Industrial Stocks for the Next Decade
- Semiconductor Industry Leader: Taiwan Semiconductor Manufacturing (TSMC) holds a dominant position in advanced semiconductor manufacturing, with a 20% year-over-year revenue growth last year, and is set to invest $165 billion to expand its U.S. capacity, ensuring its market leadership as AI demand surges over the next decade.
- High Profitability Performance: TSMC achieved a 54% operating margin in Q4 2025, significantly outperforming most software companies, showcasing its strong profitability in high-end manufacturing, and is poised to benefit from the skyrocketing chip demand driven by the AI revolution in the coming decade.
- Defense Contract Stability: Lockheed Martin's defense contracts can last for decades, providing predictable cash flows for shareholders through projects like the F-35 fighter jet, with a record backlog of $194 billion ensuring stable future revenues.
- Diverse Growth Opportunities: Lockheed Martin's participation in the $185 billion Golden Dome project and the increase of its missile defense system capacity from 600 to 2,000 units annually highlight the company's potential for growth across multiple sectors amid rising global conflicts.
See More
