In a close fight, Nvidia (NVDA) rose last week to briefly overtake Microsoft (MSFT) as the top company in the world by market capitalization. Shares are up more than 22% in the past month and have recovered significantly from the post-“Liberation Day” selloff. 

Microsoft has since narrowly edged out Nvidia to reclaim the throne, but there is no doubt that the two mega-cap tech giants will keep battling it out. 

With this in mind, is it time to add (or keep adding) Nvidia to your portfolio? For me, it’s a resounding “yes!”

Financially, Nvidia Is as Good as It Gets

Nvidia’s spree of revenue and earnings beats is perhaps one of the best in history. Unsurprisingly, that streak continued in the latest quarter. 

In its fiscal Q1 2026, Nvidia reported total revenues of $44.1 billion, up 69% from the previous year. Data center revenue, which made up the bulk of Nvidia’s overall revenues at $39.1 billion, grew by 73% from the year-ago period.

Earnings also surprised on the upside, surpassing the consensus estimate for EPS of $0.75 to come in at $0.81. For the upcoming quarter, analysts are expecting Nvidia to have EPS of $0.94 on revenues of $45.59 billion.

Although the year-over-year drop in gross margins to 61% from 78.9% in the prior year was not desirable, Nvidia continued to dominate the GPU market with a 92% share, alleviating concerns of competitive pressure. Management also reaffirmed their gross margin target of mid-70% by year-end.

Coming to cash flows, Nvidia’s net cash flow from operating activities were $27.4 billion. This marked a significant yearly leap of 79.1% as the company closed the quarter with a cash balance of $53.7 billion. With no short-term debt on its books, Nvidia’s liquidity position remains as strong as ever.

Nvidia Is in a League of Its Own

As mentioned above, Nvidia’s 92% share of the GPU market is well-deserved. Its AI chips are essential for hyperscalers like Microsoft (MSFT), Google (GOOG), Amazon (AMZN), and Elon Musk’s xAI, among others. CFO Colette Kress, during the latest earnings call, added, “On average, major hyperscalers are each deploying nearly 1,000 NVL72 racks or 72,000 Blackwell GPUs per week and are on track to further ramp output this quarter.” Thus, the swift uptake of the Blackwell architecture will continue to fuel robust double-digit growth in the data center segment. The GB200 NVL72 rack, built around 36 of these advanced AI chips, is a key driver behind this accelerating momentum.

Good news also came from the China front, as the company reported inventory charges of $4.5 billion, coming in lower than the earlier projection of $5.5 billion. In response to Chinese export restrictions, Nvidia is reportedly developing a Blackwell-based variant known as the B30, equipped with multi-GPU scaling features, according to reporting by The Information.

Additionally, Nvidia sees strong future growth potential through expansion into sovereign AI, enterprise AI, and robotics, with the Blackwell platform ramping up as a major catalyst.

Importantly, the Blackwell architecture is ramping faster than any other architecture in Nvidia’s history, fueled by a surge in demand for AI inference. 

Meanwhile, sampling of the Blackwell Ultra GB300 began in May with major cloud providers, and initial production shipments are slated for late Q2. These GB300 GPUs are expected to see broad adoption among hyperscalers, offering 50% more HBM (High Bandwidth Memory) capacity and a 50% increase in dense FP4 inference performance compared to the B200.

At the same time, governments worldwide are recognizing AI as critical national infrastructure and are moving quickly to develop sovereign AI capabilities. Nvidia has emerged as a key partner in this space, participating in numerous national AI initiatives across markets such as Saudi Arabia, the UAE, Taiwan, Sweden, Japan, Korea, India, Canada, France, the UK, Germany, Italy, and Spain.

On the enterprise front, Nvidia is accelerating the evolution of IT infrastructure toward enterprise AI factories. Its offerings, including RTX PRO Servers, DGX Spark, and DGX Station, are built to support enterprise AI and personal AI supercomputing. Major IT players such as Dell (DELL) and Hewlett-Packard Enterprise (HPE) are partnering with Nvidia to develop tailored AI data platforms. Nvidia’s Omniverse platform which is a modular set of SDKs, APIs, and microservices for building 3D applications, is also seeing growing traction, with partners like Accenture (ACN) integrating it to drive industrial digital transformation.

Looking ahead, with surging demand for agentic AI and inference, Nvidia’s growth will extend well beyond the core compute segment. The company is positioned to capture opportunities across the full AI stack, including high-performance networking and a rapidly expanding software and platform business. Underlying demand from these verticals, alongside the ongoing ramp of Blackwell and its future iterations and the push into new applications, gives Nvidia strong momentum for sustaining sequential growth in the quarters ahead.

Analyst Opinions

Considering all of this, analysts have attributed a rating of “Strong Buy” for NVDA stock, with a mean target price of $173.88. This indicates an upside potential of about 22% from current levels. Out of 44 analysts covering the stock, 37 have a “Strong Buy” rating, three have a “Moderate Buy” rating, three have a “Hold” rating, and one has a “Strong Sell” rating.