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2 Ways Nvidia is Pivoting
As one of the biggest companies in the world, Nvidia makes decisions that can significantly move the entire market up or down. In recent months, two barriers to Nvidia’s continued success have come to the fore: increased global competitiveness of more affordable AI components and the escalating trade war with China, one of Nvidia’s largest markets. Yet the mark of a good company—of a good investment—is the way it pivots in an ever-changing world. Nvidia has made two such pivots in recent weeks that showcases strong fundamentals for long-term adaptability and growth.
1. New NVLink Fusion technology responds to increased competition
Nvidia recently announced a new product, the NVLink Fusion, that will allow customers to use non-Nvidia chips with Nvidia technologies.1 This new product allows customers to build semi-custom AI infrastructure without needing to go all-in on Nvidia products top to bottom. The NVLink Fusion has already been used in compatibility with a handful of smaller AI chipmakers.
Some of Nvidia’s biggest competitors and customers, like Google, Microsoft, and Amazon are indeed building their own custom infrastructure.1 So instead of Nvidia losing out on those opportunities entirely, their new technology allows them to at least integrate partially while maintaining AI leadership.
On one hand, the new technology opens Nvidia up to capturing more of the industry as it becomes more compatible with its competitors. On the other hand, the new technology may lower demand for Nvidia chips.1 Overall, the move adds flexibility and diversification to Nvidia’s business model, an essential pivot now that it’s no longer the only major player in the AI infrastructure game.
2. Middle East partnerships respond to evolving trade restrictions with China and Taiwan
It’s been a rocky start to the year for the AI giant, but recent developments have pushed the company’s valuation back above the $3 trillion mark.2 The first is the temporary deescalation of trade tensions between the US and China, though while the trade war is temporarily paused, it is not resolved, and tensions with China are likely not going away any time soon. This relationship between the world’s two biggest economies has left one of the world’s biggest companies with a decision to make: how to offset the Chinese market.
Queue the Middle East pivot. Just as the US and the UAE pursue talks to bring more American AI chips to the Middle East, Nvidia is pursuing its own partnerships with Saudi Arabian companies to supply the regional powerhouse with the infrastructure needed to build out its AI ambitions. The partnership between Nvidia and Saudi Arabia includes the buildout of AI factories using Nvidia GPUs, an AI supercomputer, and a cloud-based AI simulation center.3 It also includes training programs for thousands of developers, scientists, and engineers.3
Perhaps unlike China, the UAE and Saudi Arabia are a different kind of customer, with the capital and appetite to become regional tech giants as collaborators with, not opponents of, the US. Geographic diversification of this kind doesn’t just offset Nvidia’s losses in China, but allows it to expand its AI infrastructure footprint globally at a time when demand for its products are high, universal, and largely unmet.
Diffusing its technology throughout the Middle East is one of the best ways for Nvidia to maintain its multi-cycle lead in AI. But Nvidia isn’t the only company expanding to the region. AMD, Amazon, ARM and others are also making the most of this opportunity for better relations with futuristic markets.4
The pivot from China to other advanced markets enables Nvidia, and other American tech companies, to not just diversify its customer base, but to more broadly expand the US’s AI dominance around the world.
Nvidia (along with AMD, Amazon, ARM and others in the AI sector) is one of 20-30 holdings in the TrueShares Technology, AI, and Deep Learning ETF (LRNZ). LRNZ holds positions representing companies, like Nvidia, with a distinct competitive advantage in their industry. Its portfolio manager has a deep understanding of the tech sector, conducting extensive qualitative fundamental research like how companies pivot when environments change.
For a full list of LRNZ holdings, visit: https://www.true-shares.com/lrnz/
- https://www.cnbc.com/2025/05/19/nvidia-announces-new-tech-to-keep-it-at-the-center-of-ai-development-.html
- https://finance.yahoo.com/news/middle-east-money-u-chips-195646267.html
- https://nvidianews.nvidia.com/news/saudi-arabia-and-nvidia-to-build-ai-factories-to-power-next-wave-of-intelligence-for-the-age-of-reasoning
- https://www.cnbc.com/video/2025/05/19/nvidia-diffusing-technology-to-middle-east-to-keep-competitive-edge.html
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