Nvidia (NVDA -0.56%) founder and CEO Jensen Huang recently participated in a fireside chat at the World Governments Summit in Dubai that was attended by delegates from 150 countries.
In a conversation with the United Arab Emirates’ (UAE) Minister of AI Omar Al Olama, Huang highlighted the importance of every country having its own sovereign artificial intelligence (AI). He stated that this capability “codifies your culture, your society’s intelligence, your common sense, your history — you own your own data.”
The incredible surge in demand for AI has helped push Nvidia stock up 240% over the last year alone — and now the company is making direct pitches to governments about the importance of the technology. Should investors be buying the stock hand over fist in anticipation of surging public sector demand?
Time to load up on Nvidia stock?
Nvidia’s dominance in the advanced graphics processing unit (GPU) space positions it to be one of the biggest beneficiaries of the AI revolution. The company’s technologies are one of the fundamental hardware elements that make it possible to run advanced AI applications.
At yesterday’s summit, Huang urged government leaders to take the initiative with artificial intelligence and use it to “activate your industry, build the infrastructure, as fast as you can.” Nvidia’s CEO is correct to frame AI as a key national security and sovereignty issue, and government spending on AI is likely to be a major performance catalyst for his company.
Crucially, this isn’t going to be a one-time thing. As just one example, AI spending is poised to become a substantial part of annual defense budgets.
Artificial intelligence is a game changer, and it has already moved to the forefront of geopolitical dynamics. While the stock could see some volatility due to sky-high performance expectations and the potential for shifts in the broader market, Nvidia still looks like a smart long-term buy.
Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.
