Nvidia Wins Big as SpaceX Exclusively Chooses Its AI Hardware

SpaceX and Nvidia have deepened their compute alliance, but which stock offers greater upside before 2028?

SpaceX's Chief Executive Officer Elon Musk stated during a recent earnings call that his company will exclusively use Nvidia hardware due to its superior architecture.

Nvidia's Vera Rubin architecture is considered the best AI computer, and SpaceX values its partnership with Nvidia. This exclusive deal cements Nvidia's position as the top compute leader.

Nvidia's revenue rose 106% year-over-year to $96.2 billion in Q2, while SpaceX's revenue increased by 92% to $7.8 billion. However, Nvidia is significantly more profitable than SpaceX, with an operating income of $63.7 billion compared to SpaceX's loss of $143 million from operations.

Nvidia's valuation is around $5.5 trillion, while SpaceX is valued at $2 trillion. This indicates that either SpaceX is overvalued or Nvidia is undervalued. Considering Nvidia's forward-looking valuation metrics, it appears undervalued with a price-to-earnings ratio of 14.5 times.