The Future of Virtual Reality Could Be Huge for Nvidia Stock

VR will pay off for Nvidia stock

By James Brumley, InvestorPlace Feature Writer

http://bit.ly/2PpsUYf
NVDA stock nvidia stock

Source: Shutterstock

Nvidia (NASDAQ:NVDA) has just unveiled a new technology that may well let virtual reality become what it was supposed to already be by now. And, though Nvidia’s role in the advent of VR won’t make or break Nvidia stock, it certainly could provide a healthy boost.

The typical layperson won’t entirely understand its inner workings, or care. Gamers, VR fans, technophiles and Nvidia stock owners, on the other hand, will almost surely be impressed. Nvidia has developed a way to create an interactive virtual reality environment using real-world videos rather than creating that world with nothing but computer coding.

A camera gets the basic layout of a terrain, including moving objects like people and cars, and artificial intelligence fills in the blanks.

The upside is the amount of time saved in building a virtual world, and the dramatically lowered cost of doing so.

Nvidia Stock and the New VR

Bryan Catanzaro, VP of Applied Deep Learning Research for the company, said:

“NVIDIA has been inventing new ways to generate interactive graphics for 25 years, and this is the first time we can do so with a neural network. Neural networks – specifically generative models – will change how graphics are created. This will enable developers to create new scenes at a fraction of the traditional cost.”

Thus far, the process and outcome are less than thrilling. Like all new developments, Nvidia’s approach to date is mostly a proof of concept, an experiment to see if it’s worth developing. Given the results achieved, however, the company seemingly intends to continue its cultivation.

Potential applications are numerous. As a research report on the technology explained, “Apart from purely scientific interests, learning to synthesize continuous visual experiences has a wide range of applications in computer vision, robotics, and computer graphics.”

Although the company made no mention of such a use, the approach may also become part of a technology used to further develop autonomous driving solutions.

Nvidia is already a frequently-overlooked player in the self-driving car arena. But, years of work on that front have led to the creation of a hardware and software combination called Drive.

Companies ranging from Audi to Uber have partnered up with the tech giant to co-develop autonomous vehicle systems. Though still nascent, this arm generated a little more than $300 million in revenue for the company during the first half of the current year.

It’s a start.

Bottom Line for Nvidia Stock

Again, as interesting and impressive as the new approach to building digital virtual worlds is, it still won’t be the company’s core business anytime soon.

Nvidia’s bread and butter remains graphics cards, mostly for gaming, where it competes with (and dominates) Advanced Micro Devices (NASDAQ:AMD). It’s also become a mainstay within the conventional, non-visual AI arena, building technology from the ground up with artificial intelligence developers in mind. Proper perspective is merited.

Nevertheless, the virtual reality hardware and software market could be worth $12.6 billion by 2025. Although it’s not clear how the AI-powered virtual world-building technology might be able to play a role in augmented reality, if it can, that would make Nvidia a player in combined markets projected to be worth nearly $100 billion in just five years.

As Nvidia better figures out how to leverage its new neural network platform to plug into that opportunity, it’s better positioned to capture more than its fair share of that market.

It’s certainly something current and prospective owners of Nvidia stock want to put on their radar.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.


Article printed from InvestorPlace Media, https://investorplace.com/2018/12/virtual-reality-nvidia-stock/.

©2018 InvestorPlace Media, LLC