Everyone's eyes are on Nvidia's (NVDA +1.04%) moves in the artificial intelligence (AI) market -- from the company's next innovations to chief Jensen Huang's thoughts about the next chapter of AI growth. Why is this the case? Because Nvidia, as the leading seller of AI chips and related systems, has its finger on the pulse of the market. The company, thanks to its own technological strengths, understanding of the market, and its conversations with customers, is well-positioned to predict what's next.
But investors aren't only looking at Nvidia's product releases and comments on demand. They're also looking at who Nvidia partners with and even where the company is investing its money. And that's why they turn to the company's 13F filings with the Securities and Exchange Commission on a quarterly basis to see what moves this AI giant has made.
In the latest quarter, Nvidia increased its holding of the following AI stock -- one that's soared almost 50% this year. Let's zoom in for a closer look.
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Nvidia's AI investments
I probably won't surprise you when I say that Nvidia's portfolio is invested in companies involved in the AI market, but they span many industries from biotech to telecom. After all, AI has what it takes to be a game changer in various areas, supercharging everything from drug development to telecom networks.
Nvidia's portfolio includes seven companies, and holdings total more than $18 billion. The company owns shares of market giants you may recognize such as Intel and Nokia, but also shares of smaller players with promising futures.
In the first quarter, Nvidia increased its position in one stock -- and by 95%, suggesting that it's optimistic about what's to come for this company. And this stock is CoreWeave (CRWV 0.47%), one that's also been generally popular among investors as it's gained almost 50% so far this year.
Here's the move Nvidia made in the first quarter:
The company increased its holding to more than 47 million CoreWeave shares, representing a value of $3.6 billion. This makes CoreWeave Nvidia's second-biggest holding after Intel.
NASDAQ: CRWV
Key Data Points
Serving up Nvidia's GPUs
Now this isn't Nvidia's only involvement with CoreWeave. The companies actually maintain a close relationship. CoreWeave's business is built around offering Nvidia's top graphics processing units (GPUs), or AI chips, to customers. What separates CoreWeave from other cloud service providers is that this young company specializes in AI workloads and offers customers great flexibility -- they can rent access to GPUs by the hour for a very short period of time or for a long-term project.
On top of this, CoreWeave has been the first to make Nvidia's newest systems, such as Blackwell and Blackwell Ultra, generally available. This is big because it shows customers that if they go to CoreWeave, they may get in on these top systems sooner than if they went elsewhere.
All of this has led to explosive growth for CoreWeave, with revenue and demand skyrocketing. CoreWeave said that the first quarter was its strongest ever for bookings -- it signed more than $40 billion in new business, and contracted revenue backlog surged to almost $100 billion.
Though CoreWeave has climbed since its initial public offering last year, it's slipped from time to time as investors worried about one thing: It's a highly leveraged company, depending on debt to fund operations. This does represent risk, so CoreWeave may not be the best investment for cautious investors -- but it's key to keep in mind that the company must take on debt and invest in order to serve current and upcoming demand.
Nvidia clearly has faith in CoreWeave, and that may reassure some investors. It's also important to point out that Nvidia has committed to buying any excess CoreWeave capacity through 2032, meaning investors don't have to worry about CoreWeave potentially getting stuck with unused infrastructure -- that's another reassuring point.
So, all of Nvidia's moves concerning CoreWeave, including the first-quarter one, show that the world's biggest AI company has confidence in this player. And that means it's a great idea to keep your eye on -- and even invest in, if you can tolerate some risk -- this hot AI stock.
