Nvidia (NVDA -5.14%) shares have surged 2,400% over the past five years, pushed higher not only by optimism about the company’s artificial intelligence (AI) chip business, but also by concrete results. The company’s earnings have been climbing in the triple digits quarter after quarter as AI customers rush to get in on the latest chip to power their projects.

This tech giant has been able to maintain its lead — and pricing power — because it offers the most powerful chips around. But in recent times, even though earnings continue to roar past expectations, Nvidia stock has lost momentum. The shares slipped 18% from the start of July through the early days of August, and in recent days they’ve stumbled, too. In fact, in one trading session this week, Nvidia lost $279 billion in market value — the biggest ever single-day drop by that measure for a U.S. company.

If you haven’t bought shares of this market giant and missed out on its earlier explosive gains, you may be wondering what your options are right now. Is it too late to score a Nvidia win, or should you buy this player on the dip? Let’s consider what to do next.

Image source: Getty Images.

Why Nvidia stock rose

First, let’s talk about why Nvidia rose so much in the first place. The company, originally focusing on sales of graphics processing units (GPUs) to the video game market, realized these powerful chips could be used in many other settings — including the high-growth area of AI. Nvidia put the focus there as companies began pouring investment into the technology, and that equaled enormous gains in revenue — and stellar stock performance.

In that early stage of AI, Nvidia was able to generate massive growth: Its data center revenue went from low levels to tens of billions of dollars in just a few years. As the technology progresses, we may not see that level of growth during each stage of development. But overall, there’s reason to be optimistic about Nvidia’s ability to significantly increase revenue over time — and go through periods of high growth, for example, when major new products are released.

And one of these periods may be right around the corner, with the company’s release of its Blackwell architecture and most powerful chip ever. Blackwell includes six game-changing technologies, offering huge advances in computational power, energy savings, networking, and security. Though Nvidia products are known to be more expensive than those of rivals, the company argues that efficiency gains should result in a lower total cost of ownership over time — meaning customers that spend more now may win in the long run.

Nvidia aims to ramp up production of Blackwell in the fourth quarter and even generate billions of dollars in revenue from the platform during that period. Demand for the system is soaring, surpassing supply, so I’m optimistic about growth not only this year but well into next year.

Nvidia’s recent decline

Now let’s talk about Nvidia’s recent stock price declines. Investors, worried about economic growth and the timing of potential interest rate cuts, have sanctioned technology stocks in general. These companies and their shares tend to suffer in a difficult economy as it’s more difficult for them to expand in that sort of environment. For example, investors may be concerned that if interest rates remain high, companies may rein in spending on technology.

But it’s important to consider the long-term picture. There’s very likely plenty to gain by buying Nvidia stock today and holding on for the long term. After all, the Blackwell platform should generate significant growth, and “other Blackwells,” as Nvidia chief executive officer Jensen Huang has said, may do the same in the coming years — Nvidia has pledged to update its GPUs annually, a key move that should drive demand for the chips.

So, while you may have missed out on Nvidia’s first wave of gains, you still could score a win down the road — and that means buying shares of Nvidia is a great step to take right now. Today, you can pick up the shares for only 37x forward earnings estimates, a level that’s very reasonable considering Nvidia’s market leadership and constant innovation.

And even if it takes longer than expected for the next chapters of the Nvidia growth story to play out, that’s OK. When investing for five to 10 years, you’ve got time on your side.