Key Takeaways
- Nvidia CEO Jensen Huang said two gigawatts of AI capacity is worth about $80 billion to Nvidia, up from about $18 billion per gigawatt in the past.
- Each gigawatt is now worth more than twice what it was, so Nvidia’s sales can grow faster than the power capacity coming online.
- At $40 billion a gigawatt, Nvidia would need about 17 of the 43 new gigawatts expected in 2027 to reach analysts’ $692 billion revenue estimate for fiscal 2028.
- Huang says land, power, and data center buildings are the main obstacle, so watch for the new partnerships he hopes to announce in Europe.
Nvidia (NVDA) CEO Jensen Huang just put a price on a gigawatt of AI capacity.
He was talking about the two gigawatts Nvidia announced in Australia a couple of weeks ago, and he told the latest episode of the BG2 podcast: “Two gigawatts to us is like $80 billion.”
Earlier in the same conversation, Altimeter Capital’s Brad Gerstner cited SemiAnalysis’s Dylan Patel on how much is on the way: “We’re going to bring on board 43 gigawatts of new AI compute next year.”
Gerstner added, “That’s more than all of the AI compute that exists in the world today.”
That’s a lot of $80 billion checks.
Nvidia’s take per gigawatt has more than doubled
That $80 billion is a big step up from where Nvidia used to be. Here’s how Huang described it:
“The offering that we offer into one gigawatt went from I guess about 18 billion or so per gigawatt to 20 some odd billion per gigawatt to now 40 plus per gigawatt”
His explanation is that Nvidia now sells far more of each data center. In his words, “we used to be a GPU company.” Then it became the biggest networking company, and now it’s adding CPUs, storage, and security on top.
He doesn’t think it stops there, either: “My sense is that that’s going to keep on going up.”
To me, this is the biggest point for the stock. If each gigawatt is worth more than twice what it used to be, Nvidia’s sales can grow much faster than the power coming online.
The Street only needs part of next year’s build-out
At $40 billion a gigawatt, 43 gigawatts works out to about $1.7 trillion of Nvidia content. Nvidia won’t win every one of those gigawatts, of course.
Huang reckons it gets about 40% of the big cloud providers’ capex today and something like 80% everywhere else.
Analysts are already expecting a lot, though nowhere near $1.7 trillion. Consensus has revenue climbing from $216 billion in fiscal 2026 (the year ended January 2026) to around $412 billion this fiscal year, then around $692 billion in fiscal 2028, which roughly covers calendar 2027…
Gerstner pointed out that a year ago, the consensus had Nvidia “flat or shrink in 2027.” Now he puts it at 74% growth, and says the old forecast “was really wrong.”
Huang’s numbers suggest the estimates still have room. Divide around $692 billion by $40 billion, and you get about 17 gigawatts’ worth of content, which is what Nvidia needs to hit its fiscal 2028 estimate and roughly 40% of what Gerstner says is coming next year. (Nvidia’s fiscal year runs a month behind the calendar, so the fit is rough.)
So not all 43 gigawatts have to show up for the estimates to hold.
More of each gigawatt reaches the bottom line
Plus, selling more of each data center hasn’t hurt Nvidia’s margins. Operating margin rose from 37.3% in fiscal 2022 to 60.4% in fiscal 2026, after a dip to 20.7% in fiscal 2023…
Fiscal 2026 came in just below fiscal 2025’s 62.4%. Still, that’s an exceptional margin for a company selling physical products, and it means each added gigawatt does a lot for profits as well as sales.
Land, power and shells could slow it down
The gigawatts still have to get built. When Gerstner asked whether 43 sounded right, Huang said “The demand is definitely there and more.” He named the catch himself, though: land, power, and shells (the data center buildings). His guess is that those “build-out resources will be one of the most important obstacles to reaching that.”
Even so, I like the math here. At more than $40 billion a gigawatt, Nvidia can hit Wall Street’s steep estimates with well under half of the new capacity on the way. A good share of the build-out could slip, and the numbers would still work.
Of course, it all depends on how fast that land and power gets unlocked. Huang said he hopes to announce new partnerships in Europe at GTC, so that’s the next thing to watch.
So what is Nvidia stock actually worth?
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