Early Tuesday, Nvidia Corp. (NASDAQ:NVDA) sank over 2% as investors remain worried over a possible slowing down in AI spendingwhich has propelled the company’s explosive ascent over the past couple of years. Now the stock is roughly almost 14% below its record high of $148.88 in early November.
After cautious comments from Microsoft (NASDAQ:MSFT) and Google (NASDAQ:GOOG) regarding slower growth in AI-related investments, Nvidia, which has become the top provider of AI chips worldwide, saw shares drop. Rumors of overheating problems with its most recent Blackwell AI systems further stoked manufacturing delayworries.
Though in its most recent report posting better-than-expected earnings, Nvidia’s stock trajectory has stayed under pressure. Still hopeful, Wedbush analyst Dan Ives forecasts Nvidia’s market value to reach $4 trillion by 2025. Complicating matters further for Nvidia, China’s competition regulator revealed this week an antitrust probe into its $7 billion purchase of Mellanox, a networking technology firm.
Driven by explosive generative AI demand, Nvidia’s quick climb saw it surpass Intel (NASDAQ:INTC) in the Dow Jones Industrial Average and momentarily switch places with Apple (NASDAQ:AAPL) as the most valuable company in 2024.
This article first appeared on GuruFocus.
