Nvidia's Billion-Dollar AI Deals Spark Bubble Fears

In October 2025, Nvidia (NASDAQ:NVDA) finds itself at the forefront of the AI revolution, reaping the rewards of this modern-day gold rush. However, the tech giant's meteoric rise is not without its challenges, as the market shows signs of overheating.

Fears of a bubble are starting to percolate, with questions mounting about the circular nature of the partnerships driving the AI industry's growth. Last month, Nvidia announced plans to invest up to $100 billion in OpenAI, the maker of the popular ChatGPT, to build and deploy 10 gigawatts of data centers powered by Nvidia GPUs. This type of financial overlap among key players has some observers uneasy, warning that it could inflate valuations in an industry still struggling to demonstrate sustainable profits.

Despite these concerns, top investor Keithen Drury remains convinced that more "massive growth" lies ahead for AI, and that Nvidia will continue to be at the center of this trend. Drury points to the astonishing pace of OpenAI's subscriber growth as evidence that Nvidia's partnership and broader AI investments are on solid footing. He also cites a projection from Nvidia CEO Jensen Huang, who estimates that global data center capital expenditures could soar from $600 billion at the end of 2025 to between $3 trillion and $4 trillion by the decade's close, fueling even more growth for Nvidia.

If Nvidia can capitalize on this demand and lift its revenues by more than 40% in the coming year, Drury believes the company's current valuation of a 1-year forward P/E of 28x looks inexpensive, making it a smart investment option now.