Warren Buffett once emphasized that a person's likelihood of investment success dramatically increases when they make a few correct decisions and avoid significant mistakes throughout their lifeAlthough this principle may appear straightforward to many investors, the real challenge lies in its practical implementation.

In the current landscape, investors are evaluating various top stocks, attempting to predict which ones will excel by 2025. While a clear solution remains elusive, the inquiry can be effectively reframed: Which company is most likely to become the first in the world to surpass a market capitalization of $10 trillion? This perspective might lead us to a more defined path.

At present, NVIDIA stands out as the most formidable contender for entry into this coveted $10 trillion "super list." Now, we delve into three pivotal reasons that underpin NVIDIA's potential for future growth.

NVIDIA has entrenched itself as the leader in the graphics processing unit (GPU) sector, with its GPUs playing a crucial role in the development of AI servers and data centers, a trend popularly referred to as the AI chip gold rush

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Over the last two years, NVIDIA's stock price has skyrocketed by over 900%, primarily driven by the success of its GPU businessNotably, during the past three years, NVIDIA's GPU revenue has experienced an annual growth rate exceeding 67%, and projections suggest that by 2025, its GPU revenue could reach a staggering $129 billion.

The critical question remains: Can NVIDIA maintain this growth trajectory in the years ahead?

The answer largely hinges on the direction artificial intelligence (AI) technology takes in the coming decadeAccording to a consensus report from the investment analysis platform Seeking Alpha (SA), NVIDIA's revenue growth is expected to remain robust in the forthcoming years, with an anticipated annual growth rate of 20.94% by 2027. This prediction might appear relatively conservative, particularly when considering NVIDIA's remarkable performance over the last decade, marked by a 62.43% compound annual growth rate over the past five years and a 37.84% rate over the last decade.

Given the current momentum of the AI revolution and the fact that the AI surge is still in its infancy, it is exceedingly likely that NVIDIA's performance in the coming years could match or even surpass these projections.

Despite some skepticism surrounding the uncertain future trajectory of AI and the unpredictable shifts in GPU demand, several critical factors could provide robust support for NVIDIA's continued growth.

The demand for computational power is poised to persistently escalate

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For those familiar with Moore's Law, which has underpinned rapid growth in the semiconductor industry for the past fifty years, it is clear that this law is driven by the relentless demand for computational capabilityThis demand is unlikely to diminish as long as there exists a disparity between the human brain and machine intelligenceThe advancements in AI technology provide compelling evidence of this trend.

Currently, NVIDIA holds a dominant position in the computational domain, claiming nearly 90% of the market share in GPUsAlthough the demand for AI computation may not align perfectly with Moore's Law, the CEO of Meta Platforms pointed out that existing AI systems require ten times the computing resources currently available.

This continual demand for computational capacity indicates that large-scale enterprises will persist in their investments and competitive pursuits within the AI sector

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Microsoft recently announced its intention to invest approximately $80 billion in the construction of AI data centers aimed at training AI modelsMoreover, xAI demonstrated the critical shortage of GPUs by deploying 100,000 NVIDIA H200 GPUs in just 19 days.

Regarding the future landscape of data centers, NVIDIA's CEO has asserted their ongoing efforts in establishing data centers comparable in size to houses, projecting these facilities to function as supercomputers with computational capacities that could surpass the combined resources of all existing data centersWith tech giants like Amazon, Alphabet, and Microsoft escalating their investments in data centers, it is reasonable to anticipate that an upgrade in data center infrastructure will significantly bolster market demand for NVIDIA's products.

The only remaining question is whether NVIDIA can produce an adequate supply of GPUs at a reasonable cost to meet this demand

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Recently, NVIDIA announced the upcoming launch of their next-generation GPUs—the GB300 and B300—which are set to debut just six months apartThese new GPUs are expected to deliver notable performance improvements in terms of model inference and training.

However, despite these advancements, the income growth forecast for NVIDIA over the next two to three years remains below the past five years' average growth rate of 37%. Thus, careful attention must be paid to market demand and production capacity dynamicsConsidering the current market demand and NVIDIA's production capabilities, I believe a revenue growth rate exceeding 30% over the next five years (up to 2030) is a reasonable and cautiously optimistic estimate.

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As for the competitive landscape, many investors have expressed concerns regarding the competition NVIDIA might face in the coming years, especially with large-scale enterprises like Amazon and Google eyeing the AI space.

Indeed, these giant corporations are developing their own AI chips primarily to reduce costs and optimize use cases, not necessarily to venture into the GPU business

If these companies truly intended to conquer the GPU market, they would need to fundamentally disrupt their existing business models—imagine Google ceasing to operate a search engine, or Amazon abandoning its retail business in favor of chip manufacturingSuch a scenario is as impractical as suggesting that Amazon should stop its delivery service to open a restaurant.

These large companies are astute enough to recognize which sectors yield profit, which is precisely why they have ascended to the status of "Big Seven." Historically, it has not been unusual for large-scale enterprises to develop their own hardware to save costsGoogle has already ventured into Tensor Processing Units (TPUs), while Tesla has attempted to design its own AI chips, and Amazon is pushing forward with AI inference hardware that employs custom cores for greater cost efficiencyHowever, none of these companies plans to pursue the GPU path—only companies like NVIDIA have the capability to introduce next-generation GPU products (such as the GB300 and B300) within a six-month timeframe.

As for rival contenders, AMD holds the position of the second-largest player in the GPU market with approximately 10% market share

Nevertheless, its market presence is facing a decline, despite the continued growth in GPU revenueAMD is likely to find it challenging to narrow the gap between its performance and that of NVIDIATo surpass NVIDIA, it would encounter significant hurdles, and even maintaining its current position could prove increasingly difficult.

Now, let’s look at the current valuation of NVIDIA, which has shot up dramatically over the last few years, raising questions among investors: "Is this a bubble? Is its valuation truly reflective of its growth?" Presently, competitive pressures seem to have eased—at least for the near future—NVIDIA remains the star that is out of reach for many.

Based on current market data, NVIDIA's price-to-earnings (P/E) ratio stands at 24 times, with a projected compound annual growth rate of 20%. This valuation appears relatively modest compared to its future growth potential

While an expected P/E ratio of 49 times by 2025 may alarm some investors, it signals the market's confidence that NVIDIA will achieve triple-digit growth in the coming years and surpass 50% growth in 2026.

In fact, the market has yet to fully internalize NVIDIA's potential for growth exceeding 20% each year.

Analyzing NVIDIA's "valuation discount," we observe that its PEG ratio (non-GAAP) stands at 1.22, which is 34% lower than the industry medianThis demonstrates that NVIDIA's valuation remains relatively inexpensive.

Using traditional growth valuation methodologies, NVIDIA appears to present an overlooked opportunity, suggesting that the market has not given adequate recognition to one of the semiconductor industry's premier growth and profitability leadersDo you believe NVIDIA will continue to dominate the semiconductor field? I am confident that the answer is a resounding yes—it is not only one of the fastest-growing companies but also boasts substantial profitability.

When will the $10 trillion mark be reached? The prospect of NVIDIA surpassing a market capitalization of $10 trillion can be viewed in two distinct phases.

In the first phase, should market sentiment improve, NVIDIA's stock price might surge rapidly within any bullish market cycle, potentially climbing 50% to reach $208, bringing its market capitalization close to $5 trillion.

In the second phase, if NVIDIA can sustain its rapid growth momentum, the stock price could double to $416, thus propelling the market capitalization beyond $10 trillion.

Moreover, Broadcom, a peer of NVIDIA, currently shares a comparable valuation, but its projected profit growth over the next two years is merely half of NVIDIA's (30% vs

111%, 20% vs50%). If the market indeed assigns NVIDIA a similar valuation to Broadcom, a scenario where NVIDIA's market capitalization exceeds $10 trillion by 2026 becomes entirely plausible.

In summary, I currently regard NVIDIA as the preferred long-term growth stockWhether or not it reaches a $10 trillion market capitalization within two to five years, I believe NVIDIA is a strong contender to become the first technology company to achieve this milestone.

So why is NVDA still a prime buy? The demand for computational power is the most intense and enduring necessity in human history, and in this "battle for computational power," NVIDIA is essentially at the forefrontRemember, they command 90% of the GPU market share, a segment that is now on the brink of a massive explosion fueled by AI.

Consider the next decade; NVIDIA's leadership is as rock-solid as a steel fortress.

From an investment perspective, I recommend accumulating more shares of NVDA as part of your portfolio by 2025. You might wonder, "Why invest now? The price is already so high." However, this is not just a demonstration of confidence in the company’s future growth potential, but also a recognition of its relentless innovation in the domains of AI and data processing