Nvidia stock down by 27% from its peak, here's what to expect next

Nvidia stock did not perform well in recent weeks, with its share prices trading down nearly 16 percent year to date. Last week, the stock witnessed a 8 percent decline in a single day (Thursday), despite its earnings report beating the estimates.

During the fourth quarter, Nvidia registered 78 percent revenue growth to $39.3 billion, going beyond the predictions of $38.2 billion. The AI chip leader's adjusted earnings per share (EPS) went up from $0.49 to $0.89, while the estimates were at $0.85.

Since the beginning of 2023, Nvidia's stock has seen 600 percent jump in the market, while its market currently hovers around $3 trillion.

Why is Nvidia’s stock down?

According to financial services company The Motley Fool, the stock price has been witnessing a downtrend as it gets caught up amid growing concerns over US President Donald Trump's latest tariffs, accompanied by concerns that its chips might have been illegally exported to China.

Currently, the Nvidia stock is down by 27 percent from its peak months ago. This is the lowest it has been since September last year.

In the semiconductor sector, Nvidia has seen only one other occasion during the past two years when it came down as it has now.

The last time it was pulled back so far was in July 2024. The sell-off was due to fears over slowing down of investment in AI infrastructure with concerns mounting about big companies overspending on data centres as well as Nvidia chips, despite no meaningful returns.

Also Read : Jennifer Lopez upset over Ben Affleck’s growing closeness with Jennifer Garner? Here’s the truth

After experiencing a double dip, Nvidia was back on track and reached its all -time highs in October last year.

History of Nvidia

The Motley Fool states Nvidia's share saw drawdowns of 50 percent and above twice during the last 10 years.

In 2018, the stock came down after going up for about a year over concerns about rising interest rates and tensions with China. Also, at that time there was a downtrend in the global economy, which includes less demand for semiconductors as well.

In a similar fashion, the Nvidia stock witnessed another decline in 2022 as there was a major crash in tech sector stocks after the revenue from crypto-related demand came down.

What's next for Nvidia?

As of now, it is impossible to predict how long Nvidia stock will see a downtrend or how far it will fall.

However, the financial services firm highlighted that the demand for the company's all-new Blackwell chips is continuing to outrun supply.

At the same time, its "competitive advantage in the data center graphics processing units (GPUs) that make up the backbone of AI applications only seems to be getting stronger," the report added.

Nvidia is next expected to recoup its recent losses in the market at some point of time in future.

Also Read : Mindy Kaling has this to say over Meghan Markle correcting her in Netflix show

FAQs

1. What's the current price of Nvidia stock?
According to the NASDAQ website, Nvidia was trading at $111.44 at 7:59 AM ET on March 7.

2. What past shows about Nvidia's downtrend in stock market?
History of the company's share shows that sell-offs have been good buying opportunities for the investors.