GPUs Are So 2024 -- This Is 2025's Hottest Trend for the $15.7 Trillion Artificial Intelligence (AI) Revolution

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When the closing bell rang on Dec. 31, professional and everyday investors had reason to cheer. The Dow Jones Industrial Average, S&P 500, and Nasdaq Composite respectively ended the year higher by 13%, 23%, and 29%, with all three indexes reaching multiple record-closing highs throughout 2024.

Catalysts have been abundant, with hefty stock buybacks, better-than-expected corporate earnings, stock-split euphoria, and President-elect Donald Trump's victory in November all working to drive stocks higher. But the biggest catalyst of all has undeniably been the rise of artificial intelligence (AI).

A hologram of a rising candlestick stock chart coming from the upward-facing right palm of a humanoid robot.
Image source: Getty Images.

The lure of AI is the virtually limitless ceiling the technology offers. With AI, software and systems are given the capacity to grow more proficient at their tasks over time, as well as evolve to learn new skills, all without the need for human intervention.

According to the analysts at PwC, artificial intelligence can increase global gross domestic product (GDP) by 26%, or $15.7 trillion, by 2030. In Sizing the Prize, PwC breaks down its expectation of a $6.6 trillion boost to global GDP coming from productivity improvements, with the remaining $9.1 trillion associated with consumption-side effects.

While the AI revolution has predominantly revolved around semiconductor colossus Nvidia (NASDAQ: NVDA) and its superior hardware up to this point, 2025 should mark the evolution of this technology to an even hotter trend.

Nvidia has prospered immensely from its time in the sun

When 2023 began, Nvidia was a $360 billion business that played a distant second fiddle to Wall Street's biggest tech stocks. But as of the end of 2024, it's a nearly $3.3 trillion company with the AI hardware that every business wants.

The reason Nvidia's sales are expected to have catapulted from $27 billion to an estimated $195 billion in three years is its AI-inspired graphics processing units (GPUs). Orders for the company's ultra-popular H100 GPU (commonly known as the "Hopper") and successor Blackwell chip are backlogged.

When demand for a good or service vastly exceeds supply, it's normal for the price of said good or service to rise until demand tapers. In Nvidia's case, it's been able to charge up to a 300% premium for its Hopper chip, relative to the cost of Advanced Micro Devices Insight MI300X GPUs. This combination of AI-GPU scarcity and phenomenal pricing power has helped lift Nvidia's gross margin into the mid-70% range.

It's also worth noting that no other GPU developer is particularly close to surpassing Nvidia in terms of computing capabilities. For instance, Blackwell is designed to accelerate computing in a half-dozen arenas, including quantum computing and generative AI, and can do so while being more energy efficient than its predecessor chip.