As of 2023, the Nvidia has been a powerhouse in AI chip technology, radically surpassing the expectations of the market.
But as competition intensifies among Nvidia competitors like AMD and Broadcom as well as changing AI infrastructure spending habits the question remains to be whether Nvidia will be dominating by 2026.
Nvidia dominance in AI Chips
In December 2025, the market capitalization of Nvidia is estimated to be about $4.517 trillion.
The company dominates the AI accelerator market with its GPUs provision of 10 gigawatts of computer power to OpenAI, 10 times larger than the 6-gigawatt contract of AMD.
In the Q3 earnings call, the company CEO, Jensen Huang, stated that the company was “sold out” of cloud GPUs, indicating that it continues to feel the increasing demand of its products.
In spite of the increasingly popular competitors like the Tensor Processing Units of Alphabet, and custom AI hardware offered by Broadcom, the innovativeness of hardware-software solution and well-developed customer base, which includes Meta Platforms, allows Nvidia to maintain its competitive advantage.
Valuation and Projections of Growth in the market
The valuation of Nvidia is 24 times forward earnings, which is competitive as compared to AMD at 33 times forward earnings and Broadcom with 30 times forward earnings.
Analysts at Wall Street predict that Nvidia will see its sales grow 48% in fiscal year 2027, which will conclude in January 2027, in line with the expectations of record capital spending in data centers, with sales expected to also hit record levels, between $3 trillion and $4 trillion each year, over the next seven years, until 2030.
Difficulties and Positioning as a Strategy
Certain investors are concerned that Nvidia might lose its market share in the event that AI infrastructure expenditure softens, or in case customers switch suppliers to address capacity constraints.
However, the current discourse stresses that Nvidia is not losing the control and stretching, instead, the company is still applying a hyper focused supply-controlled approach, the lesson learned after the previous overextension that took place in the cryptocurrency bubble
Looking Ahead
The growth of the AI market globally cannot be denied, and hyper scalers are bound to make considerable investments in data centers up to 2026.
The strategy of pricing, innovative product range, and steady demand would make Nvidia beat the S&P 500 in 2026, especially given that its company now shares are declining by 10% below recent peaks, which can potentially be a great moment of buying.
With no disastrous change in its expenditure plans, Nvidia is set to conquer the AI chip competition by 2026.
