It has been a while since Nvidia (NASDAQ: NVDA) notched a new all-time high. October 2025 was its last such high, and it’s currently down around 15% from those levels.
Despite that poor performance over the past half year, Nvidia has been delivering incredible results along with announcements regarding chip orders. I think a new all-time high for the stock is inevitable, and this is what could send it there.
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Many of investors know that the artificial intelligence (AI) hyperscalers are spending a boatload of money on data centers this year. The big four alone — Meta Platforms, Microsoft, Amazon, and Alphabet — are projected to spend around $650 billion on construction, planning, and chip costs.
Nvidia is one of the primary benefactors of this, but investors aren’t necessarily cheering on this spending. Instead, many quite skeptical about the return on investment, apparently, and would much rather see these companies moderate their AI spending. If they did that, Nvidia’s stock would be sold off to an even deeper level than it is now.
However, I don’t see that happening. Generative AI is a once-in-a-lifetime technological advancement, and we haven’t even come close to scratching the surface of what’s possible with agentic AI. As a result, companies are spending hand over fist just in case this does become everything that it promises to be.
This spending isn’t expected to wrap up in 2026, either. The chip companies cannot produce enough product to fulfill demand, so they have orders stretching several years into the future.
Nvidia is no exception — it just announced that through 2027, lifetime sales of the Blackwell and Rubin graphics processing units will be about $1 trillion. Management projected this figure to be about $500 billion last year, so clearly it is seeing huge demand for these products. And it’s not expected to stop there, either.
The company believes that global data-center capital expenditures will rise to $3 trillion to $4 trillion annually by the end of 2030. That’s a far-off projection, but with how AI spending is trending, it may not be as far-fetched as some think. Should a market that large actually develop, the stock will go through the roof over the next few years.
Still, I think with how AI spending is trending, Nvidia is primed to hit new highs. What will kick off this rally? I think it will be commentary from one of the major AI hyperscalers that this spending will continue in 2027. That will inform investors that Nvidia is far from done growing, and it would be a catalyst to send it higher.
