Nvidia (NVDA) Stock: Why Robotaxis Could Be the Next Big Revenue Driver

TLDR

• Nvidia plans to power robotaxi fleets with its AI chips and Drive AV software by 2027, targeting Level 4 autonomous vehicles that can drive without human intervention in specific regions.
• The company’s automotive and robotics division currently generates only $592 million in quarterly revenue, representing about 1% of total revenue.
• Nvidia CEO Jensen Huang announced the next-generation Vera Rubin chip platform is in full production, claiming five times better AI computing performance than previous chips.
• The Drive AGX Thor automotive computer costs about $3,500 per chip and is being adopted by Mercedes-Benz for 2026 model releases.
• Nvidia demonstrated Level 2 Plus Plus self-driving technology in San Francisco, with the system controlling the vehicle 90% of the time but requiring driver intervention in complex traffic situations.

Nvidia stock investors got fresh updates on the company’s autonomous vehicle ambitions. The chipmaker announced plans to power robotaxi fleets by 2027 using its Drive AV software platform.

NVIDIA Corporation, NVDA

Xinzhou Wu, Nvidia’s vice president of automotive, revealed the timeline during a San Francisco demonstration. The company targets Level 4 autonomous vehicles that operate without human drivers in defined areas.

Automotive and robotics chips generated $592 million last quarter. This represents 1% of Nvidia’s total revenue but marks a key growth sector outside AI infrastructure.

CEO Jensen Huang called robotics the company’s second most important category. “We imagine that someday, a billion cars on the road will all be autonomous,” Huang said at CES in Las Vegas.

Mercedes-Benz will launch 2026 models with Nvidia’s Drive technology. The system can navigate cities like San Francisco using the Drive AGX Thor automotive computer.

The Thor chip costs approximately $3,500 per unit. Nvidia markets it as a faster, cheaper path to market for automakers developing self-driving features.

Vera Rubin Platform Delivers Performance Boost

Huang announced the Vera Rubin chip platform entered full production. The new system delivers five times better AI computing performance than previous generations.

Each Vera Rubin server contains 72 graphics processing units and 36 central processors. The chips can link into pods with over 1,000 units for maximum processing power.

Nvidia claims 10-fold improvement in token generation efficiency. The company uses proprietary data formats to achieve these gains despite only 1.6 times more transistors.

CoreWeave will deploy the first Vera Rubin systems. Microsoft, Oracle, Amazon, and Alphabet plan to adopt the platform for their AI infrastructure.

Testing Shows Current Technology Limits

A December test drive in San Francisco demonstrated Nvidia’s current capabilities. A 2026 Mercedes-Benz CLA drove autonomously for 90% of an hour-long journey.

The safety driver intervened once during complex traffic involving two buses and a Waymo vehicle. The driver manually backed up and waited for the jam to clear.

Nvidia classified this as Level 2 Plus Plus technology. Full safety responsibility remains with the driver, similar to Tesla’s Full Self-Driving mode.

Mercedes-Benz models will receive lane-switching features through software updates. Hands-free highway driving, urban navigation, and park-to-park features arrive in 2026.

Nvidia faces competition from AMD and Google in AI chips. The company acquired talent from startup Groq last month, including executives who designed Google’s AI processors.

Demand stays strong for H200 chips in China. CFO Colette Kress said Nvidia applied for export licenses but awaits government approval for shipments.