Nvidia Stock Dives Amid Market Selloff. Why It’s Being Hit Harder Than Others.
Why now is the time to buy the Nvidia sell-off
Nvidia stock experienced a significant decline early on Monday, driven by concerns over economic growth and the production of its next-generation artificial intelligence processors.
Shares of Nvidia (NVDA) fell 7% to $99.81 in premarket trading, following a 1.8% drop on Friday.
The decline appeared to stem from a broader market downturn amid worries about the U.S. economy and the sustainability of gains fueled by excitement over artificial intelligence technology.
Other chip makers also saw declines, with Advanced Micro Devices (AMD) down 2.8% and Broadcom falling 5.6% in premarket trading. Server maker Super Micro Computer (SMCI) dropped 6.5%.
Nvidia’s sharp decline was partly attributed to a report from The Information, which indicated that volume shipments of its next-generation Blackwell B200 chip would be delayed by approximately three months.
According to Barron’s, such a delay could shift a few billion dollars in revenue for Nvidia from late 2024 to early 2025. Nvidia stated that production is still on track to increase in the second half of the year but declined to comment specifically on the report.
While the details remain unconfirmed, analysts suggested potential manufacturing issues with the Blackwell chips, particularly involving Nvidia’s chip-making partner, Taiwan Semiconductor Manufacturing (TSM), and its advanced chip-packaging process, CoWoS. Nvidia might need to prioritize between its Blackwell products, which include the B100, B200, GB200 Superchip, HGX B200 server board, and GB200 NVL72 liquid-cooled rack system.
UBS analyst Sunny Lin noted in a research report on Monday, “We believe Nvidia could be prioritizing CoWoS-L’s tight capacity to B200, which has higher value for the GB200 superchip… this may enable Nvidia [to have] better flexibility and be less constrained by TSMC’s CoWoS capacity.”
