NVIDIA Corporation (NVDA) Rallied On Heightened Investor Confidence In AI Infrastructure Expansion

Baron Funds, an investment management company, released its “Baron Technology Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. US equities rallied in the third quarter following the previous quarter. In the third quarter, the fund returned 5.89% (Institutional Shares) but underperformed the MSCI ACWI Information Technology Index’s (the Benchmark) 12.76% return, Invesco QQQ Trust’s (the QQQ) 8.94% return, and the S&P 500 index’s 8.12% return. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Baron Technology Fund highlighted stocks such as NVIDIA Corporation (NASDAQ:NVDA). NVIDIA Corporation (NASDAQ:NVDA) offers graphics, compute, and networking solutions. The one-month return of NVIDIA Corporation (NASDAQ:NVDA) was -0.09%, and its shares gained 29.53% of their value over the last 52 weeks. On November 7, 2025, NVIDIA Corporation (NASDAQ:NVDA) stock closed at $188.15 per share, with a market capitalization of $4.581 trillion.

Baron Technology Fund stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its third quarter 2025 investor letter:

“NVIDIA Corporation (NASDAQ:NVDA) is a semiconductor and systems company specializing in compute and networking platforms for accelerated computing. NVIDIA has captured a dominant position in AI infrastructure with a comprehensive portfolio spanning semiconductor accelerators, networking solutions, modular and rack-scale systems, and software. Shares rose during the quarter as investor confidence in AI infrastructure expansion grew. For its July 2025 quarter, NVIDIA reported 56% total and data center revenue growth. Looking forward, NVIDIA disclosed near-term visibility of tens of GWs in AI buildouts, including the 10 GW agreement with OpenAI, with each GW representing an estimated $35 billion total addressable market (TAM). During its August earnings call, NVIDIA’s management declared: “We are at the beginning of an industrial revolution that will transform every industry. We see $3 trillion to $4 trillion in AI infrastructure spend by the end of the decade.” As AI infrastructure investment accelerates, NVIDIA’s leadership continues to strengthen through durable moats across compute silicon, networking, systems, software, and supply chain. We remain confident in AI’s potential to transform the global economy and in NVIDIA’s pivotal role as the leading enabler of that transformation, positioning it to capture significant long-term value in the AI era.”

Analyst Explains How NVIDIA (NVDA) Can Reach $8 Trillion Market Cap

NVIDIA Corporation (NASDAQ:NVDA) is in 5th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 235 hedge fund portfolios held NVIDIA Corporation (NASDAQ:NVDA) at the end of the second quarter, up from 212 in the previous quarter. In the second quarter of fiscal 2026, NVIDIA Corporation (NASDAQ:NVDA) reported $46.7 billion in revenues, exceeding expectations. While we acknowledge the risk and potential of NVIDIA Corporation (NASDAQ:NVDA) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NVIDIA Corporation (NASDAQ:NVDA) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered NVIDIA Corporation (NASDAQ:NVDA) and shared the list of Jim Cramer recently discussed. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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