Nvidia's price/earnings-to-growth (PEG) ratio is currently below 1, indicating that it is undervalued relative to its growth rate. This suggests that Nvidia's current valuation is more reasonable than its price-to-earnings (P/E) ratio alone would show. However, it is important to note that the PEG ratio relies on growth forecasts, which are not guaranteed.
Nvidia's revenue target for fiscal 2025 Q2 is $28 billion, which represents an 8% increase from the previous quarter and a 107% increase year over year. This growth is driven by strong demand for the company's chips and its positioning in the artificial intelligence market.
Nvidia spent $7.34 billion on research and development (R&D) in the last fiscal year, while AMD spent $1.98 billion. Nvidia's R&D budget is more than double AMD's, and it has spent more than $24 billion on R&D over its history. This significant investment in R&D has helped Nvidia maintain its lead in graphics processing and adapt to new market trends, such as AI and data center chips3.