Jim Cramer Reviews NVIDIA (NVDA) and Data Center Demand

On August 12, Mad Money host Jim Cramer highlighted NVIDIA Corp. (NASDAQ: NVDA) during his segment, emphasizing the rapid expansion in artificial intelligence infrastructure. Following a favorable consumer price index, data center stocks gained significant traction. Lumentum, a fiber optics company, presented a compelling story, while CoreWeave reported an extraordinary quarter, showcasing a longer lifespan for their AI-equipped data centers, extending beyond the typical 3 to 5 years.

CoreWeave CEO Michael Intrator emphasized that older NVIDIA GPUs retain their worth, even those manufactured nine years ago. The chip shortage has proven that NVIDIA's chips are highly sought after and maintain their value, unlike depreciating assets such as cars. CoreWeave's stock surged by $17, and NVIDIA rallied by $7, both major gains from a company that has reported record-breaking financial results for its first quarter.

The company's total revenue reached $81.6 billion, an 85% increase from the previous year, with compute revenue soaring by 77% to $60.4 billion, and networking revenue skyrocketing by 199% to $14.8 billion. NVIDIA's CEO, Jensen Huang, stated that the worldwide construction of artificial intelligence factories signifies an unprecedented infrastructure buildout.

Gross margins for both GAAP and non-GAAP stood at 74.9% and 75% respectively, driven by strong enterprise demand for accelerated computing platforms. Despite bearish concerns about complex private credit, vendor financing arrangements, and circular deal structures, Morningstar analyst Brian Colello maintains a fair value estimate of $280 for NVIDIA.

Institutional ownership remains deep-rooted, with 275 hedge funds holding NVIDIA stock as of Q1, compared to 264 in Q4 2025. Short positions account for only 1.26% of the total public float.