Could Nvidia Be Your Best Investment in the Second Half of 2025?

Key Points

• Investor sentiment weighed on Nvidia during the first half of 2025.

• Several catalysts could act as a springboard to drive growth in the second half.

• 10 stocks we like better than Nvidia ›

Over the past few years, Nvidia (NASDAQ: NVDA) has emerged as the face of the artificial intelligence (AI) revolution. However, during the first half of 2025, the company hit turbulence. Worries about ramping competition, the potential impact of tariffs, and trade restrictions with China weighed on Nvidia's growth.

While those concerns are certainly justified, Nvidia's business continues to gain steam. Let's look at three catalysts that could give Nvidia stock a boost in the back half of the year.

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Image source: Getty Images.

1. Sovereign AI gathers momentum

CEO Jensen Huang has popularized the notion that each country should chart its own course in AI. He's encouraging leaders to create their own infrastructure, assemble and maintain data, and train their workforce to profit from this game-changing technology.

Governments of the world appear to be heeding Huang's call. The European Union (EU) has announced plans to build five AI gigafactories across the continent, and 20 individual countries, including Germany, France, Saudi Arabia, South Korea, and the United Arab Emirates (among others), have jumped on the sovereign AI bandwagon.

As the leading provider of AI-centric chips, Nvidia's strategy of promoting sovereign AI is brilliant.

2. Blackwell

It's been more than a year since Nvidia announced its Blackwell chips, but these processors only began shipping earlier this year. As such, sales of these next-generation AI chips have only just begun to impact Nvidia's financial results, with the bulk of the revenue expected to hit over the coming year.

Leading data center and cloud computing operators have pledged to spend $315 billion in capital expenditures this year, with the vast majority allocated to AI.

As the leading provider of data center GPUs, Nvidia stands to benefit from this spending.

3. Sales to China

Nvidia announced this week that it has applied for licenses to sell its H200 chips in China and has assurances from the Trump administration that they will be granted. Estimates suggest that these sales could be nearly $10 billion per quarter, which would be a significant boost for Nvidia.

That's why Nvidia could be your best investment in the second half of 2025.

Should you invest $1,000 in Nvidia right now?

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Danny Vena has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.