Tue Nov 12 11:10:00 UTC 2024: ## Nvidia’s AI Dominance Fuels Record-Breaking Growth, Despite Supply Constraints

**Nvidia shares dipped slightly on Monday but are still on track to add over $350 billion in market value this month, driven by strong demand for its AI chips.** The company, which recently surpassed Apple as the world’s most valuable, is poised to report a massive revenue surge in the third quarter, with analysts expecting an 82% year-on-year jump to nearly $33 billion.

**Nvidia’s success is fueled by the booming AI market, with major tech giants like Google, Microsoft, Amazon, and Meta heavily investing in AI compute.** UBS analysts predict these hyperscalers will spend a whopping $267 billion on AI-related projects next year, a 33.5% increase from this year. Even Tesla is heavily investing in AI compute for its autonomous driving ambitions, allocating $11 billion this year.

**While Nvidia is expected to benefit significantly from this spending, supply constraints are impacting its immediate revenue growth.** Despite strong demand for its new Blackwell processors, design changes and supply chain issues have led to delays.

**Analysts remain bullish on Nvidia’s long-term prospects, citing its dominant market position and robust demand.** Piper Sandler analyst Harsh Kumar raised his price target to $175 per share, predicting that Nvidia will capture most of the $70 billion growth expected in the AI accelerator market by 2025.

**Despite the supply constraints, Morgan Stanley analyst Joseph Moore believes Nvidia will still see significant sales of Blackwell processors in the January quarter, potentially reaching $5 billion to $6 billion.** While acknowledging that supply constraints may limit short-term growth, Moore remains optimistic about Nvidia’s future due to the strong demand signals and the company’s dominance in the AI market.

**Despite the minor dip in Monday’s trading, Nvidia shares have surged over 61% in the past six months, reflecting the market’s confidence in the company’s AI-powered future.**

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