NVIDIA Corporation (NVDA) Is “A Gating Point” For Hyperscalers, Says Jim Cramer

We recently published Jim Cramer Reveals His Trading Strategy For H2 2025 & Discusses These 16 Stockse. NVIDIA Corporation (NASDAQ:NVDA) is one of the stocks Jim Cramer recently discussed.

AI chip designer NVIDIA Corporation (NASDAQ:NVDA)’s importance in the AI chip industry also makes it one of Cramer’s most frequently discussed stocks. Cramer continues to have faith in the company and believes CEO Jensen Huang’s belief that his company will play a key role in the rollout of humanoid robots. NVIDIA Corporation (NASDAQ:NVDA)’s shares did well in June as they closed the month 16.9% higher and enabled the firm to retake the crown of being the world’s most valuable company. NVIDIA Corporation (NASDAQ:NVDA)’s shares benefited after investors failed to determine any negative catalysts on the horizon and analysts remained bullish about the AI market’s future. Cramer discussed the firm in the context of its position in the hyperscaler market:

“But I would tell you David, that HPE is one of the biggest customers of NVIDIA. . . Remember, NVIDIA is regarded as somewhat of a gating point for all of the hyperscalers cause they’re so expensive.”

A close-up of a colorful high-end graphics card being plugged in to a gaming computer.

Earlier, Cramer discussed NVIDIA Corporation (NASDAQ:NVDA) and the negotiations between the US and China:

“So, how could the president turn around these negotiations with the Chinese? Okay, so I’ve been thinking about this. I always like to be constructive. I’m a constructive fella… We only have one ace in our hand, and apparently, we don’t want to play it, the chips from NVIDIA. Under the previous administration, NVIDIA was allowed to sell China high-quality chips, but not their best stuff, which were reserved for America and a bizarre list of 18 friendly countries. Now, the Trump administration won’t even let NVIDIA sell their second or third best stuff. As CEO Jensen Huang said on our show, it’s logical to presume that China won’t use these chips for the military precisely because they’re American chips…

So what is the military risk here? Jensen says that there’s $50 billion in AI semiconductor business up for grabs in China, and NVIDIA used to have 95% of that market, but today it’s down to 50%. Sounds like the Trump administration would like it to go to zero. The Chinese are desperate for these chips. They could buy them from NVIDIA, which has the capacity to build them now, and NVIDIA could repatriate the money to build more plants right here. It’s an elegant solution that I’m providing, but I fear the White House just doesn’t care about my solution.

Still, if Trump wants to win this game, he may have to show his Trump card, NVIDIA. As I see it, the others just don’t make for a good hand. You have to play with the cards you’ve been dealt. And for decades, our government did everything it could to encourage outsourcing to China. They left us with a pretty lousy darn hand, both Republicans and Democrats. Between NVIDIA and Apple, Trump has a lot of leverage, but he doesn’t want to use it. Those two companies seem hostage to totally different agendas inside the White House.”

While we acknowledge the potential of NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.