Nvidia's stock price plummeted after launching a new artificial intelligence chi
This time, the specifics of Nvidia's new product launch had already been anticipated.
On Tuesday this week, Nvidia's stock fell in pre-market trading. The company's shares have more than doubled in the past year because this leading artificial intelligence (AI) chip supplier in the industry launched its latest flagship product, which is expected to further consolidate its leading position in the industry.
The stock of this company, the third most valuable on Wall Street, fell by about 1%. Some analysts said that investors had already factored in this release and were looking for more details.
"If the new B200 chip based on the Blackwell architecture did not trigger a new rebound, it is because the arrival of a new, more powerful chip had already been anticipated," said Ipek Ozkardeskaya, a senior analyst at Swissquote Bank.
Nvidia CEO Jen-Hsun Huang announced the launch of the new generation GPU Blackwell at GTC, with the B200 set to hit the market this year. This GPU has 208 billion transistors and uses TSMC's 4nm process. The previous generation GPU "Hopper" H100 uses a 4nm process with 80 billion integrated transistors.
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Some analysts believe that Nvidia's launch of the new generation's most powerful AI chip, Blackwell B200, without providing additional "surprises," once triggered investors to take profits. However, Wall Street still favors the stock, with Goldman Sachs raising its price target for Nvidia to $1,000. In addition, Jen-Hsun Huang's optimism about the global data center market also led to a rise in stock prices.
Huang said at an investor event in California that global spending on data center equipment will reach $250 billion annually, with Nvidia's share being higher than that of other chip manufacturers. Nvidia is also working on developing software to allow artificial intelligence technology to be adopted across various industries. The company provides AI models and other software, then charges based on the computing power and the number of chips used for running calculations that customers need. He said, "I expect this to be a very large business."
In addition to the B200 chip, the company detailed a new set of software tools at its much-anticipated annual developer conference to help developers more easily sell AI models to companies using Nvidia technology.Nvidia's flagship product, the B100 chip, combines two silicon wafers with the same size as the company's previous products, and is expected to be used by Amazon, Google of Alphabet, Meta Platforms, Microsoft, OpenAI, and Tesla.
Nvidia is also shifting from selling individual chips to selling entire systems.
"Evaluating the performance requirements of the B200 takes time, but... the company has been able to significantly raise the bar, which puts them in a very advantageous position," said an analyst at Morgan Stanley in a report.
Many analysts predict that Nvidia's market share will decline by a few percentage points this year as competitors launch new products and the company's largest customer designs its own chips.
However, Nvidia's market dominance is not expected to face a substantial challenge. The company already holds 80% of the AI chip market and is expected to provide more details on pricing and the transition from the H100 to the B100 chip in a presentation to financial analysts on Wednesday (local time).
Nvidia's forward price-to-earnings ratio is 34.6, lower than its three-year average of 42.
Semiconductors across the board are in a slump.
On Tuesday, the semiconductor industry experienced a significant downturn, with three major players—AMD, Nvidia, and Super Micro Computer (SMCI)—feeling the impact. While AMD and Nvidia suffered substantial losses, SMCI's stock price fell the most.
Shares of AMD and Nvidia plummeted on Tuesday as the semiconductor industry faced a broader market sell-off. AMD's stock closed at $178.40, down $12.25 or 6.42% from the previous trading day's $190.65, while Nvidia's stock closed at $854.41, down $30.14 or 3.41% from its last closing price of $884.55.Super Micro Computer. Among these three companies, it experienced the largest drop, with its stock price plummeting $134.83 or 13.47%, closing at $865.85. The company's stock previously closed at $1000.68, trading in a range of $93.19 to $1229.00.
Why did the stocks of AMD, Nvidia, and SMCI decline?
The stock prices of Nvidia, Super Micro Computer, and AMD fell due to various factors affecting the semiconductor industry.
Nvidia's 3% drop occurred after the announcement of its new Blackwell AI chip, despite optimistic views on the company's technology and market positioning, analysts had mixed reactions.
Similarly, AMD's stock price decline is also indirectly related to Nvidia's trend, as concerns arise about the sustainability of AMD's high valuation and the potential slowdown in artificial intelligence infrastructure spending.
Super Micro Computer's stock price plummeted significantly after announcing a proposed public offering of shares, leading investors to worry about dilution of their holdings. The timing of the announcement, coming the day after the company joined the S&P 500 index, may have fueled investor negativity.
The main risks faced by these companies include the potential failure of the artificial intelligence infrastructure boom, weaker-than-expected personal computer sales, and market saturation in artificial intelligence.
These factors could lead to a "trough of disillusionment" for tech stocks, as the explosive growth in sales and profits that high valuations of tech stocks rely on may not be sustainable in the long term.
*Disclaimer: This article is the original work of the author. The content of the article represents their personal views, and our reposting is solely for sharing and discussion, not an endorsement or agreement. If you have any objections, please contact the backend.
This time, the specifics of Nvidia's new product launch had already been anticipated.
On Tuesday this week, Nvidia's stock fell in pre-market trading. The company's shares have more than doubled in the past year because this leading artificial intelligence (AI) chip supplier in the industry launched its latest flagship product, which is expected to further consolidate its leading position in the industry.
The stock of this company, the third most valuable on Wall Street, fell by about 1%. Some analysts said that investors had already factored in this release and were looking for more details.
"If the new B200 chip based on the Blackwell architecture did not trigger a new rebound, it is because the arrival of a new, more powerful chip had already been anticipated," said Ipek Ozkardeskaya, a senior analyst at Swissquote Bank.
Nvidia CEO Jen-Hsun Huang announced the launch of the new generation GPU Blackwell at GTC, with the B200 set to hit the market this year. This GPU has 208 billion transistors and uses TSMC's 4nm process. The previous generation GPU "Hopper" H100 uses a 4nm process with 80 billion integrated transistors.
Advertisement
Some analysts believe that Nvidia's launch of the new generation's most powerful AI chip, Blackwell B200, without providing additional "surprises," once triggered investors to take profits. However, Wall Street still favors the stock, with Goldman Sachs raising its price target for Nvidia to $1,000. In addition, Jen-Hsun Huang's optimism about the global data center market also led to a rise in stock prices.
Huang said at an investor event in California that global spending on data center equipment will reach $250 billion annually, with Nvidia's share being higher than that of other chip manufacturers. Nvidia is also working on developing software to allow artificial intelligence technology to be adopted across various industries. The company provides AI models and other software, then charges based on the computing power and the number of chips used for running calculations that customers need. He said, "I expect this to be a very large business."
In addition to the B200 chip, the company detailed a new set of software tools at its much-anticipated annual developer conference to help developers more easily sell AI models to companies using Nvidia technology.Nvidia's flagship product, the B100 chip, combines two silicon wafers with the same size as the company's previous products, and is expected to be used by Amazon, Google of Alphabet, Meta Platforms, Microsoft, OpenAI, and Tesla.
Nvidia is also shifting from selling individual chips to selling entire systems.
"Evaluating the performance requirements of the B200 takes time, but... the company has been able to significantly raise the bar, which puts them in a very advantageous position," said an analyst at Morgan Stanley in a report.
Many analysts predict that Nvidia's market share will decline by a few percentage points this year as competitors launch new products and the company's largest customer designs its own chips.
However, Nvidia's market dominance is not expected to face a substantial challenge. The company already holds 80% of the AI chip market and is expected to provide more details on pricing and the transition from the H100 to the B100 chip in a presentation to financial analysts on Wednesday (local time).
Nvidia's forward price-to-earnings ratio is 34.6, lower than its three-year average of 42.
Semiconductors across the board are in a slump.
On Tuesday, the semiconductor industry experienced a significant downturn, with three major players—AMD, Nvidia, and Super Micro Computer (SMCI)—feeling the impact. While AMD and Nvidia suffered substantial losses, SMCI's stock price fell the most.
Shares of AMD and Nvidia plummeted on Tuesday as the semiconductor industry faced a broader market sell-off. AMD's stock closed at $178.40, down $12.25 or 6.42% from the previous trading day's $190.65, while Nvidia's stock closed at $854.41, down $30.14 or 3.41% from its last closing price of $884.55.Super Micro Computer. Among these three companies, it experienced the largest drop, with its stock price plummeting $134.83 or 13.47%, closing at $865.85. The company's stock previously closed at $1000.68, trading in a range of $93.19 to $1229.00.
Why did the stocks of AMD, Nvidia, and SMCI decline?
The stock prices of Nvidia, Super Micro Computer, and AMD fell due to various factors affecting the semiconductor industry.
Nvidia's 3% drop occurred after the announcement of its new Blackwell AI chip, despite optimistic views on the company's technology and market positioning, analysts had mixed reactions.
Similarly, AMD's stock price decline is also indirectly related to Nvidia's trend, as concerns arise about the sustainability of AMD's high valuation and the potential slowdown in artificial intelligence infrastructure spending.
Super Micro Computer's stock price plummeted significantly after announcing a proposed public offering of shares, leading investors to worry about dilution of their holdings. The timing of the announcement, coming the day after the company joined the S&P 500 index, may have fueled investor negativity.
The main risks faced by these companies include the potential failure of the artificial intelligence infrastructure boom, weaker-than-expected personal computer sales, and market saturation in artificial intelligence.
These factors could lead to a "trough of disillusionment" for tech stocks, as the explosive growth in sales and profits that high valuations of tech stocks rely on may not be sustainable in the long term.
*Disclaimer: This article is the original work of the author. The content of the article represents their personal views, and our reposting is solely for sharing and discussion, not an endorsement or agreement. If you have any objections, please contact the backend.