NVIDIA vs. Super Micro: Which AI Hardware Stock Should You Bet On?

The artificial intelligence (AI) revolution has ignited a race among hardware suppliers, and two of the most prominent names riding this wave are NVIDIA Corporation NVDA and Super Micro Computer, Inc. SMCI. NVIDIA dominates the AI graphics processing unit (GPU) market, while Super Micro rides the same wave by designing ultra-efficient, NVIDIA’s chip-optimized servers for hyperscalers and enterprises.Both stocks have delivered exceptional returns, but which is the better bet now? Let’s break down their fundamentals, valuation, growth outlook and looming risks to find out which one is a better investment option today.NVDA: The AI Chip Giant With DominanceNVIDIA is an undisputed leader in AI chips, data centers, gaming and autonomous vehicles. Its products are at the center of the ongoing AI revolution, driving demand from hyperscalers, enterprises and cutting-edge startups alike. The data center end-market continues to be a powerhouse for NVIDIA. Revenues from this end-market surged 93% year over year to $35.58 billion in the fourth quarter of fiscal 2025.NVIDIA’s latest earnings call underscored the company’s continued AI dominance. CEO Jensen Huang highlighted the increasing demand for next-generation AI models that require unprecedented computational power. The company’s Blackwell architecture, capable of delivering up to 25 times the token throughput of its predecessor, is expected to drive the next wave of AI adoption.Further bolstering its leadership, NVIDIA is set to launch its Blackwell Ultra and Vera Rubin platforms, which could solidify its position as the go-to AI infrastructure provider. With governments, corporations and cloud providers ramping up AI investments, NVIDIA remains the key beneficiary of this seismic shift in computing.However, the recent restrictions imposed by the Trump administration on exporting H20 chips to China are likely to hurt NVIDIA’s overall financial growth in the near term. The company’s CEO, Jensen Huang, recently stated that export restrictions on H20 chips have cost the company $15 billion in sales and expects approximately $5.5 billion in charges due to the ban in the first quarter of fiscal 2026.Despite the headwinds, NVIDIA is anticipated to remain on a high-growth trajectory. The company expects revenues of $43 billion (+/-2%) in the first quarter of fiscal 2026, indicating a year-over-year growth of more than 65%.SMCI: A High-Risk, High-Reward AI Infrastructure PlaySuper Micro Computer’s growth is driven by the need for AI workloads. As a growing number of data centers are proliferating and existing ones are expanding their capacity, the need for SMCI’s high-performance and energy-efficient servers is rising.Super Micro Computer’s liquid-cooled and modular servers are a hit among cloud service providers, government customers and enterprises as these servers possess the capacity to handle AI at scale. SMCI has further strengthened its AI expertise by collaborating with NVIDIA and integrating its Blackwell GPUs for high compute power.Despite the massive potential of Super Micro Computer’s server offerings, the company is facing some near-term challenges, including delayed purchasing decisions from customers as they are evaluating the adoption of next-generation AI platforms. SMCI is also facing margin contraction due to the growing price competition and price adjustments as companies are second-guessing their shift from older to newer platforms like Blackwell.In the last reported results for the third quarter of fiscal 2025, Super Micro Computer also incurred a one-time inventory write-down on older-generation GPUs and related components, further affecting its margins. Based on all the above factors, SMCI revised the revenue guidance for fiscal 2025 from the $23.5-$25.0 billion range to a range of $21.8 billion-$22.6 billion.EPS Estimate Trends: NVDA Stays Less Volatile Than SMCIThe Zacks Consensus Estimate for Super Micro Computer’s fiscal 2025 EPS indicates a year-over-year decline of 6%, while that for fiscal 2026 signifies growth of 36%. The earnings estimate revision trend for the two fiscals has remained highly volatile over the last 60 days.SMCI Earnings Estimate Revision TrendImage Source: Zacks Investment ResearchThe consensus mark for NVIDIA’s fiscal 2026 and fiscal 2027 EPS indicates year-over-year growth of 43% and 27%, respectively. Also, the earnings estimate revision trend for the stock has remained more stable compared with a highly volatile trend for SMCI. This stability is a testament to NVDA’s predictable performance in a volatile sector.NVDA Earnings Estimate Revision TrendImage Source: Zacks Investment ResearchNVDA vs. SMCI: Price Performance & Valuation CheckBoth companies have seen share price fluctuations over the past year amid geopolitical tensions and macroeconomic uncertainty. While NVDA shares have soared 42.8% over the past year, SMCI dropped 50.6%.Image Source: Zacks Investment ResearchValuation-wise, both NVIDIA and Super Micro Computer are trading at earnings multiples below their respective industry averages. However, NVDA’s current price-to-earnings (P/E) multiple of 29.25X is significantly lower than the one-year median of 37.28X. On the other hand, SMCI’s P/E multiple of 16.41X is slightly higher than the one-year median of 16.10X.Image Source: Zacks Investment ResearchWhile SMCI appears cheaper on a P/E basis, it comes with significantly more volatility and execution risk.Conclusion: NVIDIA is the Better AI Hardware Bet Right NowWhile both NVIDIA and Super Micro Computer are important players in the AI revolution, NVIDIA clearly stands out as the stronger investment today.NVIDIA’s dominant market position, product innovation and earnings consistency make it the AI infrastructure stock of choice. Despite geopolitical challenges, the company is still expected to deliver blockbuster growth in fiscal 2026 and beyond, driven by its next-generation Blackwell architecture and robust customer demand.Meanwhile, Super Micro Computer is more of a high-risk, high-reward satellite play. It remains a compelling company with niche strengths, but its exposure to product cycles, customer hesitation and margin pressure makes its near-term outlook more uncertain.Furthermore, NVDA carries a Zacks Rank #3 (Hold) at present, making the stock a stronger pick compared with SMCI, which has a Zacks Rank #4 (Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NVIDIA Corporation (NVDA): Free Stock Analysis Report Super Micro Computer, Inc. (SMCI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks