Nvidia Stock Plummets 8% as AI Chip Concerns and China Export Issues Spark Investor Selloff
Staff Editor Nvidia Shares Plummet 8% Amid Earnings Concerns and Export Control Issues
Nvidia Corporation, the leading graphics chip manufacturer, saw its shares tumble 8% on Monday, exacerbating a bear market trend that began in early January. The sharp decline comes as investors grapple with concerns over the company’s fourth-quarter earnings and profit margin expectations, as well as reports of AI chips reaching China despite export controls.
The tech giant’s stock has been on a downward trajectory, falling 18% in the past seven days from a February 20 closing price of $140.11 to $114.51. This recent drop has pushed Nvidia deeper into bear market territory, with shares now down more than 20% from their early January highs.
Nvidia’s fourth-quarter earnings report, while beating analyst estimates, failed to meet the lofty expectations set by Wall Street. The report included solid forward-looking guidance but raised concerns about the company’s profit margins, contributing to investor unease.
Adding to the market’s apprehension, recent reports suggest that Nvidia’s AI chips are reaching China despite U.S. export controls. The Wall Street Journal reported that Chinese tech companies are acquiring Nvidia’s advanced Blackwell GPUs through intermediaries in Malaysia, Vietnam, and Singapore. A Blackwell server with eight AI GPUs could reportedly sell for over $600,000 in China, while the previous-generation Hopper server fetches about $250,000.
The situation has prompted investigations, with Bloomberg reporting that Singapore has launched a fraud probe into whether servers shipped from Dell Technologies and Super Micro Computer to Malaysia contained Nvidia chips barred from entering China.
Technical analysts note that Nvidia shares failed to breach a key resistance level around $130 and are currently trading below both the 50-day and 200-day moving averages, potentially signaling further declines ahead.
As Nvidia navigates these challenges, investors and industry observers remain focused on the company’s ability to maintain its market leadership while adhering to complex international trade regulations.
