Bank Of America Resets Nvidia Forecast As AI Giant Extends Market Dominance

With its shares continuing to surge and pushing valuations into uncharted territory, Nvidia has become the market’s clearest proxy for the artificial intelligence boom. Now, Bank of America has reset its forecast on Nvidia, as the chipmaker continues to redefine its position in the global technology landscape.

From a company synonymous with gaming graphics, Nvidia has rapidly evolved into the backbone of global AI infrastructure. Investors are no longer betting on what Nvidia is, but they are betting on what it will power next.

The company, which pioneered the Graphics Processing Unit (GPU), has expanded its reach across multiple technology cycles, from crypto mining demand to its current dominance in AI infrastructure, powered by its CUDA software ecosystem. Its product range has expanded well beyond graphics processing units (GPUs) and central processing units (CPUs).

Revenue Breakdown

Nvidia’s revenue mix highlights its heavy dependence on the data centre business. According to Nvidia’s FY2026 Form 10-K, the company reported total revenue of $215.9 billion, of which data centre revenue stood at $193.7 billion. This means the data centre segment contributed nearly 90% of Nvidia’s total revenue, underlining how central AI and accelerated computing demand have become to the company’s growth.

Other segments include:

• Gaming
• Professional visualisation
• Automotive
• OEM and others

However, these divisions are smaller compared to the data centre business.

NVIDIA’s Stock Performance

Nvidia’s stock is up over 20% this month and has hit a fresh all-time high, increasing its market value to $5.209 trillion. The move reflects not just momentum buying, but a structural re-rating driven by AI-led earnings visibility.

Factors Supporting Nvidia’s Stock Appreciation

A combination of factors, such as strategic planning and new product launches, has boosted Nvidia's stock prices in recent months.

What Is Driving The Rally?

Demand for Nvidia’s AI chips is surging, with the company now projecting a $1 trillion opportunity through 2027. This doubles the California-based company’s earlier $500 billion estimate through 2026.

GTC Event Reinforced Product Leadership

At its December 2025 GTC event, CEO Jensen Huang launched a new CPU and an AI system built on Groq technology, signalling a push into AI inference. With competition rising from Google and others, Nvidia is expanding beyond its dominance in training to strengthen its position across the full AI stack.

Data Centre Stack Expansion

Nvidia is moving beyond GPUs, using capital and partnerships to build a full-stack AI ecosystem, thus expanding its role across the data centre value chain.

Supply Chain Constraints Turning Into Pricing Power

For Nvidia, supply constraints aren’t capping growth but they are reinforcing pricing power in an AI market where demand is effectively insatiable.

Institutional Positioning & Passive Flows

As Nvidia’s market cap has surged, its weight in major indices like the S&P 500 and NASDAQ-100 has climbed, forcing ETFs and index funds to keep buying regardless of valuation.

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