Nvidia's AI Chips Fuel Growth Despite Headwinds; Microsoft Provides Balanced But Slower AI Exposure
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Nvidia's GPUs are driving AI growth, with 78% of revenue from data centers in fiscal 2024. Revenue grew 126% and EPS 288% year-over-year.
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Microsoft is more diversified, with growth driven by cloud services and OpenAI integrations. Revenue and EPS expected to rise 15% and 19% respectively in fiscal 2024.
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Nvidia faces competitive and regulatory headwinds long-term, but is the top AI chipmaker currently and set for strong near-term growth.
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Microsoft provides a balanced AI play, but at slower growth rates than Nvidia. Antitrust is a potential concern.
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Nvidia's higher growth, reasonable valuations and pure-play AI exposure make it the better buy over Microsoft.