Nvidia Stock Could Become The Next Apple. Here's Wha…
By Daniel Foelber – Mar 24, 2026 at 6:45AM EST
Key Points
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Nvidia is building a product and service ecosystem.
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The strategy mirrors Apple’s business model, but for enterprises rather than consumers.
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Stable free-cash-flow generation opens the door for more buybacks and a growing dividend.
Image source: Nvidia.
An ecosystem in the making
Nvidia’s earnings growth has exploded in recent years as key hyperscaler customers build data centers that rely on Nvidia GPUs. The data center business is so massive that other segments professional visualization, gaming, automotive, and robotics barely move the needle. In fiscal 2026, the data center segment made up just under 90% of total revenue. And that puts pressure on Nvidia to continue selling GPUs to hyperscalers to maintain its breakneck growth rate.
Nvidia’s latest architecture, Rubin, already addresses part of the problem. It includes six chips that work together to improve efficiency at rack scale for data center applications. Many of Rubin’s breakthroughs are related to AI inference rather than training.
Think of the AI model as the knowledge base that AI agents and tools use to do real-world work. Applying AI models requires immense compute for inference.
The tokenization of inferencing creates a recurring revenue stream for Nvidia. The idea is that hyperscalers will charge customers based on the number of AI inference tokens used. As AI usage for generative AI, AI agents, and physical AI grows, so will the number of tokens demanded. Nvidia’s hardware and software are built to process tokens faster, which will appeal to hyperscalers.
All told, Nvidia’s goal is to create an ecosystem that includes its purpose-built AI chips, networking hardware, and inferencing software that will scale in lockstep with token demand — as inference and physical AI will demand far more tokens than simple chat-based generative AI.
Expand
NASDAQ: NVDA
Nvidia
Today’s Change
(1.80%) $3.11
Current Price
$175.81
Key Data Points
Market Cap
$4.3T
Day’s Range
$174.76 – $178.37
52wk Range
$86.62 – $212.19
Volume
15K
Avg Vol
175M
Gross Margin
71.07%
Dividend Yield
0.02%
Taking a page out of Apple’s playbook
Nvidia’s road map for capitalizing on inferencing recurring revenue mirrors Apple’s blueprint.
iPhone is the focal point of an ecosystem of Apple products that complement each other — from iPhone to Mac, iPad, Apple Watch, AirPods, etc. This is similar to Nvidia building on its GPU business with “extreme codesign” to capture revenue from AI data center compute, networking, and storage.
Apple has services that directly support those products, iCloud, as well as services that can be integrated and used by those products — Apple Music, Apple TV, Apple Card, etc. Nvidia’s recurring revenue stream from AI inference tokens would this same business model.
Apple has evolved into a stable, high-margin, moderate-growth company that generates a ton of free cash flow (FCF) to buy back stock and steadily increase its dividend. Similarly, Nvidia expects to spend 50% of its FCF this year on buybacks and dividends. Nvidia only pays a $0.01 quarterly dividend now, but I could see it announcing a massive dividend raise ed by moderate annual increases in a similar vein to what Apple has done for 14 consecutive years.
Nvidia is a great buy now
A potential slowdown in growth sounds bad news for Nvidia. But in reality, it could just mark the next stage of the company’s maturation.
If Nvidia were able to reduce its dependence on data center hardware through an inferencing-as-a-service revenue stream, it could make the stock more appealing to balanced investors who a little passive income sprinkled on their long-term holdings. After all, Apple commands a much higher valuation than Nvidia — with Apple trading at 29.3 times forward earnings compared to just 21.9 for Nvidia — suggesting that some investors value predictable earnings growth and balance more than the prospect of hypergrowth.
All told, Nvidia’s build-out of a recurring revenue stream is a brilliant way to help reduce the pain of an eventual pullback in hyperscale capital expenditures — making the stock’s investment thesis even more appealing to long-term investors.
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About the Author
Daniel Foelber is a contributing Motley Fool stock market analyst with extensive experience covering the broader stock market and publicly traded companies across energy, industrials, utilities, materials, technology, communications, consumer discretionary, consumer staples, and financial stocks. Daniel looks for industry leaders offering compelling growth, value, or dividends to generate passive income. He has also written for energy trade publications and helped build oil and gas training modules. He holds a bachelor’s degree in finance and a certificate in personal financial planning from the University of Houston. He believes the best investors are those who focus on fundamentals, remain steady through volatility, and filter out market noise.
Stocks Mentioned
Nvidia
NASDAQ: NVDA
$175.81
(+1.80%)+$3.11
Apple
NASDAQ: AAPL
$251.44
(+1.39%)+$3.45
*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.
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