Nvidia recently reported its Q4 results, and the news was strong. The company beat Wall Street’s expectations for both revenue and earnings, continuing its impressive growth.
But despite the good news, Nvidia’s stock price dropped slightly, raising the question: Is it still a good time to invest in Nvidia?
Nvidia’s Strong Q4 Performance
Nvidia’s revenue for Q4 reached $39.33 billion, marking a 78% increase from the previous year and 12% more than the previous quarter.
This exceeded both the company’s forecast and analysts’ expectations. The company’s adjusted earnings also saw a boost, up 71% year-over-year and 10% higher than the previous quarter.
The real star of Nvidia’s Q4 was its data center business, which grew 93% year-over-year and 16% from the previous quarter, making up nearly 91% of the company’s total revenue.
Challenges Amid the Growth
Despite these strong numbers, there were some signs of slowing growth. In comparison, Nvidia saw much higher growth in previous quarters, such as 94% in Q3 and 122% in Q2.
Additionally, Nvidia’s gross margins fell slightly, down 3% from the previous year to 73%.
What’s Next for Nvidia?
Looking forward, Nvidia’s first-quarter revenue projection for fiscal 2026 is $43 billion, slightly below analysts’ expectations.
The company also expects its gross margin to decrease further, forecasting 71% for Q1.
While these figures aren’t bad, investors are cautious because of Nvidia’s high valuation. The company trades at nearly 31 times forward earnings, so expectations are high.
Should You Buy Nvidia Stock Now?
While Nvidia’s growth may be slowing, there’s still a lot to be optimistic about. The AI market continues to expand, and Nvidia remains a key player in providing powerful chips for AI applications.
CEO Jensen Huang highlighted that AI models require increasingly more computing power, and Nvidia is well-positioned to meet that demand.
For growth investors, Nvidia still looks like a strong choice, despite the slower growth and lower margins in the short term.
If Nvidia’s AI chip dominance continues, it could have more strong quarters ahead, making the stock worth considering now.
