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NVIDIA: Dominant AI GPU Provider Driving Data-Center Growth
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Published in Stocks and Investing on Sunday, November 16th 2025 at 7:50 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
Three AI‑Powered Stocks Worth a Serious Look in 2025
(A 500‑plus‑word summary of The Motley Fool’s November 16, 2025 article “3 brilliant AI stocks to load up on right now.”)
1. The AI Engine: NVIDIA (NVDA)
The article opens with a quick refresher on why NVIDIA remains the go‑to name for AI. The company’s GPUs are the hardware backbone of everything from self‑driving cars to generative‑AI models, and its data‑center revenue has been on a compound‑annual‑growth (CAGR) trajectory of roughly 40 % since 2020. The author cites NVIDIA’s recent earnings release (linked in the article) to underline the firm’s “super‑luminous” earnings per share, which beat consensus by more than 30 %.
Key take‑aways for investors:
| Driver | Why it matters | Evidence in the article |
|---|---|---|
| GPU dominance | The sheer market share (≈ 80 % of the AI GPU market) gives NVIDIA a pricing advantage | Chart of GPU sales vs. competitors |
| Data‑center expansion | More data‑center customers mean higher recurring revenue | Projection of 2026 revenue to hit $12 B |
| Self‑driving push | Automotive AI is a high‑margin, long‑term growth engine | Link to a Reuters piece on NVIDIA’s partnership with Ford |
| Strategic acquisitions | NVIDIA’s recent buy of Mellanox & Arm integration (though not completed) underlines its “AI‑first” mindset | Link to Bloomberg coverage of the Arm deal |
The article warns that the only real “catch” is the volatility of the semiconductor supply chain. It quotes a recent semiconductor‑industry analysis (linked) that warns of potential chip‑stacking issues if global demand spikes again. Despite this, the author recommends buying “in a disciplined, dollar‑cost‑averaging fashion” and highlights NVIDIA’s current price‑to‑sales (P/S) ratio of 9.6 as “reasonably valued for a high‑growth tech player.”
2. The Cloud AI Powerhouse: Microsoft (MSFT)
Moving on, the Fool writer frames Microsoft as the “software‑in‑the‑cloud” champion of AI. Microsoft’s Azure platform is now the largest AI‑as‑a‑service (AIaaS) provider, with an estimated 45 % share of the market for language‑model workloads. The article references Microsoft’s latest earnings release (again, linked) that disclosed a 38 % year‑over‑year jump in Azure revenue, largely attributed to the “Copilot” suite, which embeds GPT‑style models into Office 365.
Why Microsoft stands out:
- Copilot revenue engine – The author points out that Microsoft’s Copilot platform is now integrated into the entire Microsoft 365 suite, and the revenue from this “new product category” is expected to grow to $15 B by 2027.
- OpenAI licensing – Microsoft is the sole enterprise customer for OpenAI’s GPT‑4 and future models, giving it a lock‑in advantage. A link in the article goes to a policy brief on the “OpenAI–Microsoft partnership” that explains the licensing terms.
- Hybrid cloud advantage – The article notes that Microsoft’s “Azure Arc” and “HoloLens” initiatives make it uniquely positioned to bring AI to on‑premise data centers and IoT devices.
The writer also highlights the risks: potential regulatory scrutiny over the Microsoft‑OpenAI relationship and the “turbulence in the commercial SaaS space” if competitors (like Amazon and Google) accelerate AI feature rollouts. Nonetheless, the article concludes that Microsoft’s current P/E of 28 is “generous, but justified” by its “solid dividend yield and strong cash‑flow generation.”
3. The AI Research Leader: Alphabet (GOOGL)
The third pick is Alphabet, the parent of Google, which the author describes as the “research and ecosystem hub” for AI. Alphabet’s AI ventures include DeepMind (which pioneered AlphaFold), Vertex AI, and the Bard chatbot. The article links to Alphabet’s Q4 2025 earnings release, noting a 15 % increase in “AI‑powered cloud services” revenue.
Key points for Alphabet:
- Vertex AI dominance – The article explains that Vertex AI is now the most widely adopted AI platform on the cloud, with a 30 % market share. Alphabet’s “AI‑first” culture has turned it into a “platform for everyone.”
- DeepMind’s breakthroughs – The writer references a Nature article (linked) that showcases AlphaFold’s recent advances in protein folding, arguing that this translates into downstream business opportunities for drug discovery.
- YouTube’s recommendation AI – The article notes that YouTube’s recommendation engine has become “one of the best performing AI systems in the world,” which not only boosts ad revenue but also improves user engagement.
Alphabet’s P/E of 23 is presented as “reasonable” in the context of its massive research pipeline and robust cash reserves. The author mentions a possible risk: the “anti‑trust environment” in the U.S. and EU, which could lead to regulatory constraints on AI research. However, the piece argues that Alphabet’s diversified portfolio mitigates this risk.
How the Article Frames the Big Picture
At the beginning, the author lays out a compelling narrative about how AI is no longer a niche buzzword but a “systemic economic driver” affecting virtually every industry. He cites a McKinsey report (linked) estimating that AI could add $15 trillion to global GDP by 2030. The article stresses that the three companies chosen are the ones “most likely to ride this wave” because of their deep technical capabilities, strong balance sheets, and proven track record of capturing market share.
Investor Take‑aways
The author wraps up with a concise “action plan” for readers:
- Start with NVIDIA – Buy at $650 or lower, focus on quarterly earnings to gauge data‑center performance.
- Add Microsoft – Consider buying a $50‑$60 block, pay attention to Azure AI metrics and Copilot adoption.
- Finish with Alphabet – A $140–$160 range is “ideal,” and investors should monitor AI‑related patents and regulatory filings.
He recommends a “buy, hold, and watch” strategy rather than a quick flip, underscoring that AI growth is a long‑term trajectory. He also reminds readers that all three companies have strong dividend policies (Microsoft at 0.8 % and Alphabet at 0 % but with significant free‑cash‑flow returns).
Final Thoughts
While the article is firmly bullish, it does not shy away from discussing the risks: supply‑chain bottlenecks, competition from rivals like Amazon Web Services and Meta, and regulatory headwinds. It also encourages diversification across sectors—not just AI, but the broader tech ecosystem.
If you’re looking to add a high‑growth, AI‑centric tilt to your portfolio in 2025, the Motley Fool’s article presents a concise, well‑reasoned case for NVIDIA, Microsoft, and Alphabet. Each company is backed by robust fundamentals, proven execution, and a clear path to scaling their AI services, making them compelling candidates for any investor who believes AI will shape the next decade.
Read the Full The Motley Fool Article at:
[ https://www.fool.com/investing/2025/11/16/3-brilliant-ai-stocks-to-load-up-on-right-now/ ]
