Nvidia, arguably the world’s most important stock because of its leadership in the Artificial Intelligence revolution, reported strong numbers Wednesday afternoon after the market closed. Earnings and revenues were better than expected. Concerns about gross margin pressure as the company transitions from the Hopper GPU semiconductor platform to the Blackwell GPU platform were misplaced. The company met guidance on margins. Gross margins were a very high 74.5%, with operating margins in excess of 62%.
Those are outstanding numbers. Very high margins and strong revenue growth enable the company to generate significant amounts of free cash flow. Over a two-year period, Nvidia can deliver $200 billion in free cash flow. That is an incredible achievement. The company can deploy that cash flow to continue to stay far ahead of its closest competitor, AMD. Nvidia has about an 80%…
