Nvidia (NVDA -3.01%) has been one of the hottest stocks on the market in the past five years, delivering remarkable gains of 1,300% to investors during this period and significantly outpacing the tech-laden Nasdaq Composite‘s returns of about 100%.
The semiconductor giant’s terrific upside can be attributed to the healthy demand for its graphics processing units (GPUs), which are powering multiple applications ranging from artificial intelligence (AI) servers to cars to personal computers to “digital twins.” These multiple end markets have led to outstanding growth in Nvidia’s revenue and earnings over the past five years.
Nvidia’s market capitalization of $2.5 trillion makes it the third-largest company globally. The good part is that Nvidia could deliver more gains in the future thanks to a sizable addressable market that could allow it to sustain healthy revenue and earnings growth for years to come.
However, there is another tech giant that could outpace Nvidia in the long run, thanks to its presence in several multibillion-dollar end markets. Let’s take a closer at that name and check why it has the potential to overtake Nvidia’s market cap in the next five years.
AI, cloud computing, and e-commerce could send this tech giant soaring
Amazon.com (AMZN -1.01%) is the world’s fourth-largest company, ranking behind Nvidia with a market cap of $1.9 trillion. That gap puts Nvidia’s market cap 30% larger than Amazon’s.
Amazon has underperformed both Nvidia and the Nasdaq Composite over the past five years, registering gains of just 45% during this period. Another thing worth noting is that Amazon stock has lost about 20% of its value so far in 2025 amid broader weakness in the stock market due to tariff-fueled unease.
However, the recent pullback means that investors now have an opportunity to buy a solid tech company that can benefit from multiple lucrative markets at an attractive valuation. Amazon is one of the leading e-commerce companies in the world, and it also dominates the massive cloud computing market that’s set to get bigger thanks to AI.
Amazon reportedly controlled 40% of the U.S. e-commerce market last year. That’s a great position to be in as the U.S. e-commerce market is expected to show a healthy annual growth rate of 15% through the end of the decade, generating annual revenue of over $19 trillion.
Importantly, Amazon is expanding its wings in foreign e-commerce markets as well. For example, Germany is considered to be the largest e-commerce market in Europe, and Amazon has reportedly captured half of this market already. Meanwhile, Amazon is the biggest e-commerce player in the U.K. as well, which is the second-largest e-commerce market in Europe and the third-largest globally.
The size of the European e-commerce market is expected to triple between 2024 and 2030, generating over $10 trillion in annual revenue after five years. So, Amazon’s e-commerce segment should witness robust growth going forward, and a similar situation should unfold in the cloud computing space as well.
Amazon’s 30% share of the cloud infrastructure market puts it well ahead of second-placed Microsoft, which has a 21% share. The cloud infrastructure market is projected to generate annual revenue of $2 trillion in 2030, according to Goldman Sachs. AI is set to play an important role in driving this market’s growth over the next five years, and the investment bank points out that generative AI could account for 10% to 15% of global cloud spending by 2030.
This massive end-market opportunity could supercharge Amazon’s growth. The company’s Amazon Web Services (AWS) cloud computing business finished 2024 with almost $108 billion in revenue, up by 19% from the year-ago period. The potential size of the global cloud infrastructure market and Amazon’s solid share in this space suggest that this segment could take off remarkably in the long run.
More importantly, the company has been trying to bring down the cost of running AI applications on AWS by developing in-house custom processors, which it claims can offer a 30% to 40% price-to-performance advantage as compared to cloud instances powered by graphics cards. As a result, many companies have started using Amazon’s cloud instances powered by its custom AI processors to run AI workloads.
Amazon’s accelerating earnings growth should lead to stock price upside
Amazon is set to spend heavily on capital expenditures (capex) this year to shore up its AI infrastructure. Specifically, the company plans to bump up its capex by 20% in 2025 to $100 billion. This heavy spending is going to weigh on Amazon’s earnings growth this year, with analysts expecting its bottom line to jump by 14% in 2025 to $6.32 per share.
However, the forecast for the next couple of years points toward an acceleration in Amazon’s earnings growth.
AMZN EPS Estimates for Current Fiscal Year data by YCharts
Its earnings could jump by 19% next year, followed by a stronger jump of 25% in 2027. Assuming Amazon can sustain even a 20% annual earnings growth rate in the three years following 2027, its earnings could jump to $16.22 per share in 2030. If the stock is trading at 28 times earnings at that time, in line with the current level of the tech-laden Nasdaq-100 index, its stock price could jump to $454.
That would be 1.6 times Amazon’s stock price as of the April 16 market close, which could send Amazon’s market cap closer to $4.75 trillion. This solid jump could be enough for Amazon to overtake Nvidia’s market cap over the next five years if the latter struggles on account of a drop in AI hardware spending or because of increased competition.
Given that Amazon is currently trading at 28 times forward earnings, investors are getting a good deal on this “Magnificent Seven” stock that I predict will overtake Nvidia’s market cap in the next five years.
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Goldman Sachs Group, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
