As big tech ramps up what could total nearly $700 billion in artificial intelligence-driven capital expenditures, a top analyst believes Nvidia Corp. (NASDAQ:NVDA) stands to capture as much as half of that spending.
Analyst Says Nvidia Is ‘Hard To Bet Against’
On Wednesday, Futurum Group CEO Daniel Newman took to X and said that Nvidia could see 40% to 50% of the magnificent seven’s committed AI capital expenditures flow its way.
“$NVDA should see 40-50% of the ~$700 Billion in Mag 7 committed AI Capex. Hard to bet against that,” Newman wrote.
Newman also shared a clip from his Fox Business appearance. In the clip, he can be heard arguing that even if returns on AI investments take time to materialize for major tech companies, Nvidia benefits immediately because it supplies the critical infrastructure.
“About 40% or 50% of that spend goes to none other than Nvidia,” Newman said, adding that the chipmaker continues to generate strong cash flow and revenue growth while trading at roughly 23 to 24 times forward earnings.
Big Tech’s AI Spending Surge
The projected spending comes from aggressive investment plans across the tech giants.
Amazon.com Inc. (NASDAQ:AMZN) said the company expects to invest about $200 billion in capital expenditures in 2026, citing “seminal opportunities like AI.”
Meta Platforms Inc. (NASDAQ:META) forecasts full-year 2026 capital expenditures between $115 billion and $135 billion, with total expenses reaching as high as $169 billion.
Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL) said 2026 CapEx is expected to range from $175 billion to $185 billion.
Microsoft Corp. (NASDAQ:MSFT) reported $37.5 billion in capital expenditures in its second quarter alone, with roughly two-thirds allocated to short-lived assets such as GPUs and CPUs.
Tesla Inc. (NASDAQ:TSLA) has forecast capital expenditures exceeding $20 billion next year, targeting AI compute infrastructure and factory expansion.
During the company’s first-quarter earnings call, Apple Inc. (NASDAQ:AAPL), while noting volatility in its CapEx due to a hybrid model, said it continues investing in tooling and data centers.
Nvidia Earnings In Focus
Jensen Huang-led Nvidia is set to report fourth-quarter results Feb. 25.
Analysts expect revenue of $65.55 billion and earnings of $1.49 per share, according to Benzinga Pro data.
Nvidia carries a consensus price target of $261.54 based on ratings from 37 analysts. The three latest analyst updates by Jefferies, RBC Capital and Mizuho have an average price target of $263.33, suggesting approximately 38.15% upside potential.
Price Action: In the past six months, Nvidia shares have gained 4.36%. On Wednesday, it gained 0.78%, according to Benzinga Pro.
According to Benzinga Edge Stock Rankings, Nvidia continues to show a solid price trend across the short, mid and long-term time frames, though it carries a weaker score on Value metrics.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo by Robert Way via Shutterstock
Recent Comments