This Hypergrowth Stock Will Finish 2025 as the World’s Largest Stock — and It’s Not Nvidia

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This Hypergrowth Stock Will Finish 2025 as the World’s Largest Stock — and It’s Not Nvidia

The world was introduced to Nvidia in 2024. The semiconductor company is the leading seller of computer chips for artificial intelligence (AI)

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, which are getting a huge boost in demand. Nvidia’s revenue and profits have soared in the last few years, with investors getting uber-bullish on the stock. As of this writing, Nvidia has a

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of $3.46 trillion, making it the largest company in the world by market value.

I think 2025 will be the year the Empire strikes back, with the rest of big tech regaining a negotiating foothold as semiconductor supply chains catch up with demand for AI products. Who will that benefit the most? My bet is

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(NASDAQ: AMZN), the largest cloud computing company in the world, which is the backbone of many AI tools that are growing like gangbusters.

Along with its dominant e-commerce operation,

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’s cloud computing division will allow it to finish 2025 with the largest market cap in the world. Here’s why.

Unlike the rest of the big technology companies that already have sky-high profit margins,

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’s profitability is still vastly understated due to its propensity to invest for future growth. Last year, we started to see the company finally take its foot off the gas, a trend I think will continue in 2025.

Over the last 12 months ending in September,

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posted an operating margin of 9.8%, a record high. Part of this is due to the

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Web Services (AWS) cloud computing segment, which had an operating margin of 35%. I expect AWS margins to remain strong, but the segment is still less than 20% of

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’s overall sales.

Margin expansion is mainly coming from

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’s dominant North American e-commerce business, which posted an operating margin of 5.9% over the last 12 months. Still at a compressed level — especially when you consider the tens of billions in high-margin third-party e-commerce fees, subscriptions, and advertising sales it brings in every year —

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has plenty of room to bring segment profit margins even higher in 2025.

While it won’t be an overnight story,

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can easily finish 2025 with a profit margin of 15% and most likely 20%, if it wants. The only question is how efficient its spending on research projects such as Alexa it will be.

There is a clear path to

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expanding its profit margins in 2025. There is also reason to believe it will keep accelerating revenue growth, especially at AWS.

AWS’s net sales growth went from 12% in Q3 a year ago to 19% year-over-year growth last quarter. The ***** in AI spending should continue in 2025, with capital expenditure budgets seemingly going up every day. This is a good thing for AWS, as more capital expenditures mean more demand for AI computing power, which means more revenue for AWS. In fact, famous investor Softbank announced it will be investing $100 billion in AI in the United States. While all of this will not be spent on AWS data centers, the trend is here to stay.

Story Continues

If AWS can grow its revenue by 30% over the next 12 months as more and more AI demand gets fulfilled, the division will reach $134 billion in sales and help accelerate

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’s consolidated revenue growth.

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data by

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.

My belief in

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finishing 2025 as the largest company in the world largely rests on an acceleration in revenue growth at AWS and consolidated profit margin expansion. Here’s the math that shows why this could occur.

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’s trailing 12-month revenue is $620 billion, with sales growing 11% year-over-year last quarter. If revenue growth can accelerate to 15% over the next 12 months, that will bring annual sales to $713 billion. It is a staggering size but shows the massive markets

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is going after in e-commerce, retail, and cloud computing.

As I discussed above, there is room for

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to expand its operating margin to close to 20% in 2025. While I’m not confident it will hit exactly 20%, there should be high conviction in the general direction of this metric in 2025. If

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stopped investing in research projects, the company would likely have profit margins even higher than 20%.

The 20% profit margins on $713 billion in revenue equals $142.6 billion in operating income. This is above the operating income generated by Nvidia, Apple, and

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over the last 12 months. While not a guarantee, I think the company that generates the highest profit should have the largest market cap in the world, especially one with promising growth prospects such as

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. For this reason, I think

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will finish 2025 as the stock with the largest market cap in the world, making it a buy for your portfolio right now.

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a

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recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $369,816!*

Apple: if you invested $1,000 when we doubled down in 2008, you’d have $42,191!*

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: if you invested $1,000 when we doubled down in 2004, you’d have $527,206!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

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*Stock Advisor returns as of January 21, 2025

John Mackey, former CEO of Whole Foods Market, an

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subsidiary, is a member of The Motley Fool’s board of directors.

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has positions in

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. The Motley Fool has positions in and recommends

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, Apple,

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, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on

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and short January 2026 $405 calls on

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. The Motley Fool has a

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.

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was originally published by The Motley Fool

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#Hypergrowth #Stock #Finish #Worlds #Largest #Stock #Nvidia

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