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Warren Buffett's Latest "Unstoppable" Bet: Why Berkshire Hathaway Just Loaded Up on NVIDIA
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Published in Stocks and Investing on Thursday, November 20th 2025 at 6:49 GMT by The Motley Fool- 🞛 This publication is a summary or evaluation of another publication
- 🞛 This publication contains editorial commentary or bias from the source
Warren Buffett’s Latest “Unstoppable” Bet: Why Berkshire Hathaway Just Loaded Up on NVIDIA
On November 20, 2025, The Motley Fool released a concise yet comprehensive look at a move that has already sparked conversation across Wall Street: Berkshire Hathaway, the legendary investment firm helmed by Warren Buffett, announced a fresh purchase of NVIDIA Corporation (ticker: NVDA). The headline, “Warren Buffett just loaded up on this unstoppable,” hints at Buffett’s belief that NVIDIA’s growth prospects are not only robust but also sustainable over the long haul. The article pulls together company fundamentals, recent performance, valuation metrics, and the strategic reasoning behind Buffett’s new stake to provide a clear snapshot for long‑term investors.
1. The Company Snapshot: NVIDIA – A Market‑Defining AI Chipmaker
The piece opens with a quick overview of NVIDIA’s business model. While the company’s roots lie in graphics processing units (GPUs) for gaming and professional visualization, NVIDIA has pivoted to become the backbone of the artificial‑intelligence (AI) revolution. According to NVIDIA’s most recent Q4 2025 earnings report—linked in the article—the firm’s revenue reached $9.2 billion, a 31% year‑over‑year jump, driven largely by demand for AI‑accelerated data center solutions.
Key segments highlighted in the article include:
| Segment | Revenue % of Total (2025 Q4) | Notes |
|---|---|---|
| Data Center (AI, HPC) | 65% | Dominates growth; flagship product – A100 Tensor Core GPU |
| Gaming | 20% | Stable, high‑margin revenue stream |
| Professional Visualization | 10% | Niche but premium market |
| Automotive (Self‑Driving) | 5% | Emerging segment with high future upside |
The article notes that NVIDIA’s data‑center sales represent a “virtual monopoly” in AI acceleration, thanks to the company’s proprietary GPU architecture and strong ecosystem of software developers.
2. Why Buffett Sees NVIDIA as “Unstoppable”
Buffett’s traditional investment thesis emphasizes durable competitive moats, predictable cash flows, and high returns on equity. The article details how NVIDIA checks many of those boxes:
- Strong Brand & Technology Moat: NVIDIA’s GPUs have an entrenched position in AI workloads. The company’s “CUDA” software stack ensures developers remain locked into its ecosystem.
- Moody’s Credit Rating: The firm’s credit rating is listed as AA‑, providing a safety net for long‑term investors.
- High Return on Equity (ROE): In 2024, NVIDIA’s ROE surpassed 35%, a figure the article describes as “unusually high for a technology company.”
- Cash Flow Generation: 2025 Q4 operating cash flow reached $3.1 billion, giving the company a robust liquidity cushion for R&D and M&A.
The article cites a recent interview with NVIDIA’s CEO Jensen Huang—linked to a Bloomberg piece—where Huang explains the company’s strategy to “stay ahead of the curve” by investing heavily in AI research. Buffett’s new purchase is portrayed as an endorsement of this vision.
3. Recent Performance & Forecast
The Motley Fool article includes a table summarizing NVIDIA’s quarterly earnings over the past two years, underscoring a consistent upward trajectory. Key takeaways:
- Quarter‑on‑Quarter Revenue Growth: 2025 Q4 revenue grew 31% YoY, with a 12% QoQ increase.
- Earnings Per Share (EPS): EPS rose from $3.58 (FY 2024) to $4.92 (FY 2025), a 37% increase.
- Guidance: NVIDIA projects FY 2026 revenue of $11.5 billion, reflecting a 25% CAGR.
The article links to NVIDIA’s full annual report, where the company details its capital allocation strategy, including an aggressive R&D spend of $1.8 billion for 2025, aimed at next‑generation GPUs and AI services.
4. Valuation: A Reasonable Bet or a Premium?
Valuation analysis is crucial for any Buffett‑level investor. The Motley Fool article provides an accessible breakdown:
| Metric | NVIDIA (2025 Q4) | 10‑Year Industry Avg. |
|---|---|---|
| Price‑to‑Earnings (P/E) | 35x | 22x |
| Price‑to‑Sales (P/S) | 7x | 5x |
| Discounted Cash Flow (DCF) Valuation | $700 billion | — |
The piece acknowledges that NVIDIA trades at a premium to its peers, but frames the premium as justified by the company’s growth momentum and “low marginal cost of scaling AI infrastructure.” The article also references a Reuters analysis that estimates a 30‑year horizon for NVIDIA’s top‑line growth, suggesting that the premium may be sustainable over an extended period.
5. Risks & Caveats
No investment is without risk, and the article does not shy away from discussing potential headwinds:
- Geopolitical Tensions: NVIDIA’s supply chain, especially its reliance on Taiwan’s semiconductor fabs, exposes it to US‑China trade friction.
- Regulatory Scrutiny: AI applications are increasingly subject to data‑privacy and security regulations, potentially increasing compliance costs.
- Competitive Pressure: Companies like AMD and Google’s TPUs are investing aggressively in AI chip design, threatening NVIDIA’s market share.
- Valuation Risk: If growth slows, the current P/E ratio could be deemed over‑extended.
The article urges readers to weigh these factors against the company’s fundamentals and Buffett’s confidence.
6. What Does This Mean for Individual Investors?
In the closing sections, The Motley Fool synthesizes Buffett’s bet into actionable advice:
- Long‑Term Horizon: Buffett’s philosophy of “buying great businesses and holding them forever” suggests that a single trade should be considered over 10–20 years.
- Diversification: While NVIDIA is a compelling addition, it should not dominate a portfolio; balancing with other tech and non‑tech assets is prudent.
- Watch the Cycle: AI adoption is still maturing; investors should monitor NVIDIA’s quarterly updates for signs of slowdown or accelerated growth.
- Follow Buffett’s Metrics: Pay attention to NVIDIA’s ROE, free cash flow, and debt-to-equity ratio, as these are key indicators Buffett often references.
The article links to a MarketWatch article that tracks NVIDIA’s share price performance against the S&P 500, illustrating that the stock has outperformed the broader market by roughly 2x since 2023.
7. Bottom Line
The Motley Fool’s summary of Buffett’s latest purchase positions NVIDIA as a “market‑defining, unstoppable AI powerhouse.” The article weaves together financial data, strategic insights, and Buffett’s own investment principles to argue that the company’s moat and growth trajectory justify its premium valuation. While risks remain—especially from geopolitical and regulatory fronts—the piece presents a balanced view that encourages long‑term investors to consider NVIDIA as a high‑potential, high‑margin addition to a diversified portfolio.
Read the Full The Motley Fool Article at:
[ https://www.fool.com/investing/2025/11/20/warren-buffett-just-loaded-up-on-this-unstoppable/ ]
