- Nvidia has invested heavily in AI-focused firms like Intel and CoreWeave.
- The two stocks account for for 71.6% of Nvidia's portfolio as on March 31.
- Nvidia is also investing heavily in companies developing photonics technolog
Nvidia has been a force to reckon with in the field of artificial intelligence. The chipmaker is investing heavily in two fields to ensure its dominance.
One of the ways is heavy R&D investments. Apart from that, Nvidia has also been investing in AI-focused companies, with just two of them - Intel and CoreWeave - accounting for 71.6% of its portfolio, as per The Motley Fool.
At 51.6%, Intel comprises a little over half of Nvidia's portfolio investment as on March 31. The company is one of the leaders in the field of server CPU (Central Processing Unit), a sector that is expected to gain more significance as the world moves towards agentic AI.
As companies race towards artificial intelligence systems that can plan and execute tasks instead of just responding to prompts, CPUs will be critical in this venture. Nvidia CEO Jensen Huang has predicted that the world could eventually have billions of autonomous AI agents, leading to more demand for CPUs.
Over the past 12 months, Intel's stock has surged by almost 500%. The company's shares are trading at an astonishing 151.5x forward earnings, compared to the average of 24.4x for IT stocks.
As for CoreWeave, the stock forms 20% of Nvidia's portfolio. CoreWeave has partnered with leading AI players like OpenAI and Microsoft to increase its revenue. The company's revenue jumped 111.6% year over year in the first quarter, coming to around $2.1 billion.
Apart from these investments, Nvidia has also committed to investments to help solve a major bottleneck in the AI rollout. Over the past three months, the company has committed to channeling at least $6.5 billion into firms that are developing photonics technology, CNBC reported.
Photonics technology can be used in AI to move data between servers, data centres, graphics processing units (GPUs), memory and networking chips via light instead of relying solely on electrical signals running along copper.
Since the start of March, Nvidia has announced investments of $2 billion into Marvell, Lumentum and Coherent, all of which are developing photonics tech. The chip giant also planned to invest $500 million into Corning for the development of advanced optical connectivity solutions. Nvidia has also participated in the $500 million Series E funding round of optics startup Ayer Labs.
