NVIDIA Corp. (NVDA): Why Billionaire Chase Coleman’s Bet on AI Could Pay Off Big

Billionaire investor Chase Coleman, founder of Tiger Global Management, has long been a contrarian in tech investing—pioneering bets on AI long before it became a mainstream obsession. Today, NVIDIA Corp. (NASDAQ: NVDA) sits as one of his most prominent holdings, constituting nearly 5% of his $23.4 billion equity portfolio as of late 2024. This stake reflects Coleman’s belief that NVIDIA, the undisputed leader in AI infrastructure, remains undervalued despite recent volatility. Here’s why his bet could deliver outsized returns.

The Case for NVIDIA: Dominance in AI’s Engine Room

At the heart of NVIDIA’s value proposition is its graphics processing units (GPUs), the workhorses of the AI revolution. These chips power everything from generative AI models to autonomous vehicles and cloud computing. Coleman’s portfolio, which also includes Meta, Microsoft, and Alphabet—firms that rely heavily on NVIDIA’s GPUs—suggests he views the company as a “winner-takes-most” player in the AI arms race.

The numbers back this up. NVIDIA’s trailing revenue hit $96.3 billion in 2024, with analysts projecting a staggering 127% revenue surge to $129 billion in the current fiscal year. Its 55% profit margin, among the highest in tech, underscores the pricing power of its AI-focused products. Even after a 20% correction from its February 2025 highs, NVIDIA’s forward P/E ratio of 31.75 remains reasonable compared to its growth trajectory.

Coleman’s Play: Long-Term, Through Volatility

Coleman’s approach is classic contrarian: he’s held NVIDIA shares since at least early 2024, even as the stock swung wildly. A 25% drop in early 2025—driven by fears of trade restrictions and a slowdown in AI enthusiasm—presented a buying opportunity for him. His portfolio’s 43% allocation to AI stocks, including NVIDIA, reflects a decade-plus time horizon, betting that AI spending will grow exponentially.

The stock’s dip to $120 in early 2025 contrasts with a 12-month price target of $175, implying a 46% upside from recent lows.

Why the Bulls Are Right

1. AI Infrastructure Dependency: Hyperscalers like Amazon and Microsoft are pouring record sums into cloud data centers, all of which require NVIDIA’s GPUs. The firm’s $53 billion net income in 2024 highlights the durability of this demand.
2. Software Synergy: NVIDIA’s AI software stack, including the CUDA platform, locks in customers. Even competitors using rival chips often rely on CUDA for compatibility, creating a near-monopoly in AI software.
3. Long-Tail Opportunities: Autonomous vehicles, healthcare AI, and enterprise applications are nascent markets where NVIDIA’s expertise could amplify returns.

The Risks: Trade Wars and the Next Big Thing

No bet is without risk. U.S. export controls on advanced chips to China could trim $5.5 billion in revenue, though over $10 billion in orders for its H20 series had already been fulfilled by April 2025. Meanwhile, upstart AI chipmakers like Graphcore or Cerebras might erode margins over time. Yet, as Morgan Stanley noted in April, NVIDIA’s 114% revenue growth over the past year suggests it can outpace these threats.

Conclusion: A Decade-Long Bet Pays Off

Coleman’s NVIDIA stake isn’t just about today—it’s about the next decade. With 223 hedge funds now holding NVDA, including 10% owned by institutions, the stock’s liquidity and analyst support are robust. The $175 price target implies a 46% gain from recent prices, but the true prize lies in NVIDIA’s role as the “operating system of AI”.

Consider this: A $1,000 investment in NVIDIA in 2005 grew to $578,000 by 2025, outpacing even tech giants like Amazon. If AI adoption follows the hockey-stick trajectory of the internet boom, NVIDIA’s current valuation could look cheap in hindsight. For investors with Coleman’s patience, this is a bet on nothing less than the future of computing.

Analysts project global AI spending to hit $15 trillion by 2030—NVIDIA’s share could be a multi-billion-dollar windfall.

In short, NVIDIA’s position as the AI backbone makes it a rare stock that could deliver 10x returns over the next decade—a reality Chase Coleman is willing to wait for.