NVDA Stock Forecast: Why Nvidia Is Building Stakes in Chip Makers

Semiconductor giant Nvidia (NVDA) is aggressively expanding its influence across the ecosystem through strategic multibillion-dollar stakes in key chip makers and partners. These moves signal confidence in AI-driven growth amid surging demand for advanced computing.

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Below are some of Nvidia’s most notable investments to date:

• $2 billion investment in Marvell (MRVL) for custom AI networking chips.
• Nvidia invested $5 billion in Intel (INTC), becoming a top shareholder to boost U.S.-based manufacturing and CPU integration.
• $2 billion in Synopsys (SNPS) for electronic design automation (EDA) tools essential to chip innovation.
• $2 billion in Nebius (NBIS) to support AI data center expansion.
• $2 billion in CoreWeave (CRWV) to speed up global AI factory buildouts.

These calculated bets diversify Nvidia’s supply chain and position it as a key architect of the AI infrastructure revolution, potentially boosting NVDA stock over the long term.

Why Is Nvidia Making These Bets?

These investments diversify Nvidia’s supply chain away from overseas reliance, while supporting U.S. goals for domestic semiconductor strength. For instance, Nvidia relies heavily on Taiwan Semiconductor Manufacturing (TSM) for chips, but recent reports show TSM remains overbooked through 2026, risking chip supply shortages.

Nvidia is also ensuring optimized hardware for its AI chips by backing ecosystem partners. These companies excel in areas from design to deployment, fueling demand for Nvidia’s core products. Partnerships like these create synergies, such as custom networking from Marvell that enhances Nvidia’s GPU clusters.

Analyst View on NVDA-MRVL Deal

Rosenblatt Securities analyst Kevin Cassidy called Nvidia’s $2 billion investment in Marvell Technology “positive for both companies.” It expands Nvidia’s ecosystem support for NVLink scale-up networks and telecom infrastructure for inference-stage AI. As Marvell management states, “Marvell is uniquely positioned to offer all potential paths to customers for scale-up switching.”

Cassidy expects Marvell to continue developing the UALink open scale-up network standard as well as NVLink Fusion. Overall, he sees this as a positive trend for the AI industry.

Potential Risks from Such Deals

Nvidia’s investments in these chip makers face several risks amid its AI push. Here’s a brief overview:

• Financial: $13 billion outlays risk straining cash and diluting value if targets underperform amid high valuation scrutiny.
• Geopolitical: Trump tariffs and U.S. export curbs on China raise costs and disrupt partner supply chains.
• Competitive: Hyperscaler custom chips and AMD (AMD) erode GPU dominance, while TSMC bottlenecks limit investment benefits.
• Market Uncertainty: AI spending bubble fears and external shocks like conflicts threaten data center expansion.
• Execution Challenges: Circular deals risk regulatory issues, like Intel’s integration failures could drag returns.

Is NVDA Still a Strong Buy?

Yes, NVDA still commands a Strong Buy consensus rating based on 41 Buys, one Hold, and one Sell rating on TipRanks. The average Nvidia price target of $273.34 implies 56.7% upside potential from current levels. Over the past year, NVDA shares have surged 58.3%.