Prediction: Here's Where Nvidia Is Headed in 2026

Nvidia (NASDAQ: NVDA) has been one of the best stocks to own in 2023, 2024, and 2025. It has outperformed the market each year, and now that we're on the doorstep of 2026, investors are wondering if it can do so again. But next year could be more challenging, as many investors are starting to fear that AI stocks are in a bubble.

Where is Nvidia heading in 2026? In one sense, it's hard to guess, but the stock's performance may be out of its hands.

Image source: Getty Images.

Nvidia projects monster growth for 2026

Any company only has so much influence over how its stock performs in the short term. Market sentiment can really drive short-term performance, and if the market is bearish on the prospects of artificial intelligence, Nvidia's stock may suffer even if its business is doing great.

The company's graphics processing units (GPUs) are currently the most popular parallel processors in the AI realm. The flexibility these devices provide, combined with their impressive computing power and the strengths of the CUDA programming platform, which allows developers to get the most out of them, makes them a no-brainer choice. However, there are other hardware options gaining ground. AMD has alternatives that are starting to become more attractive, in part thanks to their lower prices. Broadcom is partnering directly with AI hyperscalers to create their own custom AI chips, called application-specific integrated circuits. For the specific computing tasks those chips are designed for, they can outperform Nvidia's at lower prices -- at the cost of flexibility.

Despite the rising competition, during Q3, Nvidia's sales rose 62% year over year to $57 billion. Its data center division, which is the most connected to the AI trend, was even stronger, with revenue up 66% to $51.2 billion. Compared to AMD's $4.3 billion in data center revenue (up 22% year over year) and Broadcom's AI semiconductor revenue, which rose 63% to $5.2 billion, Nvidia is clearly still miles ahead.

Management believes its results will continue to impress for some time. CEO Jensen Huang noted that Nvidia is sold out of cloud GPUs, as demand outpaces supply. Furthermore, Nvidia noted that it has visibility into around $307 billion in revenue from its Blackwell and Rubin systems over the next five quarters.

Considering Nvidia's trailing-12-month revenue was $187 billion, that could amount to a more than 30% increase in revenue from those platforms alone in 2026.

NVDA Revenue (TTM) data by YCharts

That's impressive growth for a company of its enormous size, which should sustain Nvidia's stock in 2026. But will the market agree?

Nvidia's stock has been weak over the past month

Nvidia's stock currently sits about 13% below the all-time high it touched in October. That's surprising considering how strong its latest results were. But the market is growing wary about AI hyperscalers' abilities to sustain their massive data center buildout plans, and if they dial back their spending, Nvidia would suffer. Still, the market doesn't dictate what the hyperscalers are going to do, and Nvidia has repeatedly stated that it foresees global data center capital expenditures reaching $3 trillion to $4 trillion annually by 2030.

NVDA PE Ratio (Forward 1y) data by YCharts.

Time will tell if that projection pans out, but even if it doesn't, Nvidia will be a must-own stock, as eventually, the market will start to value the company for all of the growth it's delivering. In the meantime, investors can now scoop up shares at an attractive price of about 24 times next year's earnings.

Keithen Drury has positions in Broadcom and Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy.