Nvidia Reaches $4 Trillion Valuation: Should You Buy NVDA Stock?

Nvidia has become the world's first $4 trillion company, and Bank of America analyst Vivek Arya sees further upside in NVDA stock. Arya believes Nvidia's dominant market share (80%) in the fast-growing AI market will drive its share price up in the second half of 2025. He also downplays concerns about custom AI chips posing a threat to Nvidia's business. With a "Buy" rating and a price target of $180, indicating potential for a 10% gain from current levels, Arya remains bullish on NVDA shares.

NVIDIA has recently achieved a monumental milestone, becoming the world's first $4 trillion company. This unprecedented growth is a testament to the company's dominance in the fast-growing AI market. Bank of America analyst Vivek Arya has expressed further optimism for NVIDIA's stock, predicting significant upside in the second half of 2025. Arya believes that NVIDIA's commanding market share in AI, currently at 80%, will drive its share price upward. He also downplays concerns about custom AI chips, asserting that they are unlikely to pose a substantial threat to NVIDIA's business. With a "Buy" rating and a price target of $180, Arya indicates a potential 10% gain from current levels, reflecting his bullish stance on NVDA shares.

NVIDIA's Q2 2025 financial results underscore its pivotal role in the AI revolution. Data center revenue surged to a record $26.3 billion, up 154% year-over-year, accounting for 88% of total revenue [1]. The company's GPU architecture, particularly the Hopper-based H100 and H200 GPUs, has become synonymous with AI performance. The introduction of the next-gen Blackwell architecture has further cemented NVIDIA's leadership, with pre-orders already driving significant revenue expectations.

Arya's optimism is backed by NVIDIA's ecosystem lock-in strategy, which creates switching costs for enterprises investing in its tools and architectures. This deepens NVIDIA's moat as AI becomes increasingly embedded in various sectors, including healthcare, automotive, and enterprise software. The company's software-first strategy, including tools like NIM and the AI Foundry, has expanded use cases and created recurring revenue streams.

While supply constraints for Blackwell GPUs and market volatility in China pose near-term risks, NVIDIA's outlook remains bullish. The company expects trailing-12-month data center revenue to grow further as production scales and inference workloads expand. Assuming $100 billion in annual data center revenue by 2026, with margins expanding due to higher ASPs for advanced chips, NVIDIA's valuation could easily surpass $1 trillion [1].

Investors are encouraged to focus on NVIDIA's secular growth narrative rather than short-term market fluctuations. The AI market's addressable size is expected to reach $200 billion by 2030, with NVIDIA's ecosystem lock-in ensuring it captures a disproportionate share. Historically, NVIDIA's stock has demonstrated resilience following significant earnings beats, with a 70% win rate at the 30-day mark following earnings surprises [1].

In conclusion, NVIDIA's ascension to the $4 trillion milestone and Bank of America analyst Vivek Arya's optimistic outlook present a compelling investment thesis. The company's dominant market share in AI, strong ecosystem lock-in, and robust financial performance position it as a core holding for those betting on AI's transformative potential.

References:
[1] https://www.ainvest.com/news/nvidia-1-trillion-ambition-riding-ai-tsunami-dominance-semiconductors-2507/
[2] https://247wallst.com/forecasts/2025/07/08/nvidia-nvda-price-prediction-and-forecast/