Nvidia Trades at 21× Forward Earnings as CEO Sees $1 Trillion GPU Orders
Following a recent pullback, Nvidia trades at 21× forward earnings with $215 billion in annual revenue and over 70% gross margins, while Jensen Huang projects $1 trillion in GPU orders through 2027. Investors cite 73% year-over-year revenue growth and leadership in AI inference chips as key valuation drivers.
1. Valuation Pullback
Nvidia's share price has declined recently, bringing its forward price-to-earnings multiple down to approximately 21×. This contrasts with typical high-growth tech stocks trading near 29×, prompting renewed interest from value-oriented investors.
2. Revenue Growth and Profitability
The company reported $215 billion in trailing annual revenue, up 73% year over year, with gross margins exceeding 70%. High-margin AI chips for inference and emerging AI agents underpin these robust profitability figures.
3. $1 Trillion GPU Order Forecast
CEO Jensen Huang guided for $1 trillion in combined GPU system orders through 2027, reflecting strong enterprise and hyperscaler demand for AI infrastructure. This long-term backlog supports visibility into future revenue streams.