Nvidia, Broadcom Can Both Win As Physical AI Set To Be Next 'Multi-Trillion Dollar' Opportunity, Says Daniel Newman

The artificial intelligence (AI) boom is far from peaking; in fact, experts argue it is merely expanding into a new, multi-trillion-dollar phase centered on “Physical AI,” which will accommodate growth for both Nvidia Corp. (NASDAQ:NVDA) and custom chip rivals like Broadcom Inc. (NASDAQ:AVGO).

The Next Multi-Trillion Dollar Frontier

According to analysis shared by Daniel Newman, the CEO of Futurum Group, and data from Morgan Stanley, the tech industry is transitioning from the era of chatbots into a massive “Physical AI” cycle.

This shift—encompassing wearables, autonomous devices, and humanoid robots—represents the next multi-trillion dollar Total Addressable Market (TAM).

Despite fears of an AI bubble, the expert suggests we are “so damn early” in the cycle. Current datacenter capacity is reportedly nowhere near sufficient to support the incoming wave of enterprise and physical generative workloads, signaling sustained demand for hardware infrastructure well into the 2030s.

The next multi-trillion dollar TAM will be physical AI. And while we aren't even close to having enough datacenter capacity to support enterprise and generative workloads, soon we will have a massive physical AI transition. 🤖

Bubble. LMAO 😂

You aren't bullish enough on AI.… pic.twitter.com/G8OY50OA2l

— Daniel Newman (@danielnewmanUV) December 29, 2025

See Also: Intel Stock Has Soared Since Its Dow Ouster — Even Outrunning Nvidia, Its Replacement

A Widening Market, Not A Zero-Sum Game

Tech analyst Beth Kindig of I/O Fund dispels the notion that the rise of custom silicon, such as Alphabet Inc.'s (NASDAQ:GOOG) (NASDAQ:GOOGL) TPUs or Broadcom’s ASICs, spells doom for Nvidia.

Speaking on the expanded semiconductor landscape, Kindig argues that the AI monetization wave will “widen,” allowing new entrants to capture revenue without displacing Nvidia's dominance.

“We are not at a static point,” Kindig noted, emphasizing that while Broadcom may capture share in the inference market, Nvidia remains the “near monopoly” for training due to its robust CUDA software ecosystem and relentless R&D pace.

With Bloomberg Tech, I broke down why the upcoming AI monetization wave will widen (not shrink or plateau) to where both Nvidia $NVDA and other chipmakers continue to benefit. pic.twitter.com/lIqCyE4Tuk

— Beth Kindig (@Beth_Kindig) December 29, 2025

CapEx ‘Inflection Point’

The scale of this build-out is evident in corporate spending. Kindig highlighted Oracle Corp. (NYSE:ORCL) as a prime example, where 2026 capital expenditure estimates have more than doubled from $9 billion to over $20 billion.

While some analysts have likened this to “drunken sailor” spending, tech CEOs are banking on a massive “inflection point” of monetization to absorb these costs.

With companies like OpenAI hitting a $20 billion run rate faster than any company in history, the market appears primed to validate these massive hardware investments.

Nvidia Outperforms In 2025

Shares of Nvidia have risen by 40.16% year-to-date and 19.32% over the last six months. However, it closed 1.21% lower at $188.22 apiece on Monday.

NVDA maintains a stronger price trend over the short, medium, and long terms, with a poor value ranking. Additional performance details, as per Benzinga’s Edge Stock Rankings, are available here.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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