Nvidia Corp (NASDAQ:NVDA, XETRA:NVD), the US chipmaker, is in talks to invest in Perplexity as part of a funding round that would value the artificial intelligence startup at more than $30 billion, The Information reported on Sunday.
The report, citing people with knowledge of the discussions, said the round would lift Perplexity's valuation by more than 50% from its previous financing a year ago.
Perplexity, which runs an AI-powered search and answer engine, has seen annualised revenue climb to more than $750 million, up from less than $250 million at the start of the year, according to the report.
Part of that growth has been driven by Perplexity Computer, a cloud-based agent that professionals use to automate computer-based tasks.
The Information reported last September that Perplexity had settled on a $20 billion valuation, meaning the company's worth has risen sharply in the space of a year.
Perplexity declined to comment, while Nvidia did not immediately respond to a request for comment.
The startup, which signed a $750 million cloud agreement with Microsoft earlier this year, plans to go public in 2028.
Its backers include Nvidia, Amazon founder Jeff Bezos and Japan's SoftBank Group.
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Nvidia stock NASDAQ:NVDA enters a pivotal week near $215 after five consecutive declines, with investors weighing a reported move to deepen its relationship with AI search startup Perplexity just days before quarterly earnings.
Shares closed Friday at $214.72, down almost 5% from Monday’s close, as higher bond yields and renewed doubts over the AI trade pressured semiconductor names.
The Perplexity talks add another strategic signal: Nvidia is still deploying capital across the AI ecosystem while shareholders want clearer evidence that those investments will reinforce chip demand.
The Information reported on Sunday that Nvidia is discussing an investment in Perplexity as part of an equity round valuing the startup at more than $30 billion.
That would be more than 50% above the roughly $20 billion valuation attached to Perplexity’s previous financing.
Perplexity’s annualised revenue has climbed above $750 million from less than $250 million at the start of 2026, helped by its Perplexity Computer AI agent, according to The Information.
Nvidia is already an investor, while the companies have also been working together through Nvidia’s Nemotron Coalition.
The potential deal fits Nvidia’s strategy of investing in companies that use or expand demand for its computing platforms.
The Information said Nvidia had previously considered a technology-licensing and hiring arrangement with Perplexity before talks shifted towards a conventional equity investment.
The Perplexity talks are strategically interesting, but Nvidia’s August 26 earnings are likely to matter far more for the stock.
Wall Street expects fiscal second-quarter revenue of about $92.1 billion and adjusted earnings of $2.09 a share.
That would mark another quarter of exceptional growth, but expectations are already demanding.
Nvidia stock has barely advanced since the previous earnings report despite continued profit growth. Options markets are pricing a move of roughly 5.3% around the results.
Investors will focus on Blackwell demand, the Vera Rubin ramp, China sales and whether rising component costs pressure gross margins.
They will also look for more detail on Nvidia’s financing commitments across AI infrastructure.
Wall Street remains bullish, but the bar is highAnalyst sentiment remains positive. Bank of America analyst Vivek Arya sees Nvidia’s valuation as attractive despite vendor-financing concerns and maintains a $350 price target.
His view is that the market may be assigning too much weight to financing risks relative to Nvidia’s free-cash-flow potential.
BMO Capital is similarly constructive. In research carried by TipRanks, the firm initiated Nvidia with an Outperform rating and a $340 target, arguing that demand remains strong and much of the company’s capacity is already committed for more than 12 months.
TipRanks puts the broader Wall Street consensus target near $302, implying roughly 40% upside from Friday’s close.
That leaves the Nvidia stock outlook bullish but highly dependent on execution.
A Perplexity investment would strengthen the company’s position across the AI stack, but Wednesday’s earnings still need to show that infrastructure spending is translating into durable revenue, margins and cash flow.
With the shares entering the report after a five-session slide, a strong outlook could reset momentum.
Tech stocks, AI stocks, semiconductor stocks, it seems like everyone is trying to catch the next Nvidia (NVDA -0.98%). When people look around for the best semiconductor stock to buy right now, I don't go to any flashy new names; I still go straight back to good ol' Nvidia. I've watched chips and cycles come and go, and no other name sits as close to the center of the AI world as Nvidia does today.
In the first quarter of fiscal 2027 (ending April 26, 2026), Nvidia reported revenue of $81.6 billion, with data center sales of $75.2 billion, up 93% year over year and now more than 90% of the company's total revenue. That data center number matters more than any gaming rebound or auto contract because it shows where the company now lives. Every time Microsoft, Meta Platforms, Amazon, or Alphabet expands its AI clusters, it spends large sums on Nvidia systems. When sovereign funds and start-ups talk about AI factories, they are mostly talking about racks full of Nvidia hardware and software.
Image source: Getty Images.
The hardware itself has moved past single chips. Blackwell GPUs pack around 208 billion transistors and use a custom chip process. Two dies are tied together via a 10-terabyte-per-second link, so they behave like one large device. Those GPUs then slot into systems like GB200 and GB300 that connect Grace CPUs, Blackwell accelerators and Spectrum networking into unified AI racks. On top of that stack, you find CUDA, Nvidia AI Enterprise, and an ecosystem of tools for training, fine-tuning, and inference. All this sounds heavy, but in other words, Nvidia does not sell just chips alone. It sells an AI factory-in-a-box.
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What keeps me in the stock heading into 2027 is how demand and pricing look together. AI factory compute has become an investable asset class in its own right. Nvidia has partnered with BlackRock, Blackstone, Goldman Sachs, and others to help mobilize more than $500 billion in third-party capital to finance AI infrastructure, with Nvidia designing and supplying the platforms.
Rental pricing for H100s and B200s tells the same story. One year, H100 rates climbed from about $1.70 per GPU-hour in October 2025 to roughly $2.35 per GPU-hour in March 2026, with on-demand cloud prices near $2.70 per GPU-hour by June. Blackwell rates run higher still in a band from about $5.30 to $7.05. Those numbers show that Nvidia has not had to discount its way through this boom.
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The mental side of Nvidia There is also a psychological side that investors rarely admit but that matters. Nvidia has become the default AI ticker. When a retail trader wants exposure to AI, the first search box entry is Nvidia. When a pension fund wants a core AI position without building a basket of small names, Nvidia is the simple answer. Analysts cover the company closely, and price targets for the next year still point to gains from current levels on top of an already large move. Popularity can cut both ways in corrections, yet it also means Nvidia has steady access to capital and close scrutiny, which tends to keep execution sharp.
None of this means Nvidia is risk-free. Custom ASICs will chip away at some workloads. AI capex cycles can slow if macro conditions shift or if major customers pause spending. Regulators around the world are paying closer attention to concentration in compute supply. Those concerns matter. When I weigh them against the current setup, though, I still see Nvidia as the best way to own the AI infrastructure theme through 2027. Data center revenue growth, full-stack systems, strong pricing, and deep mindshare all point in the same direction.
Micah Zimmerman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, BlackRock, Blackstone, Goldman Sachs Group, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.
Mírně záporné otevření, v týdnu Jackson Hole, výsledky NVDA
V úvodu posledního srpnového týdne naznačují futures pro indexy mírně záporné otevření (kolem -0,2 %). Pod tlakem je „obchod s AI“ před zveřejněním klíčových výsledků a výročním zasedáním FEDu. Neboli investoři očekávají v komentářích předsedy FEDu K. Warshe v Jackson Hole vodítka k vývoji úrokových sazeb a také se připravují na zveřejnění výsledků hospodaření a výhledu NVDA. Americké státní dluhopisy rostou s klesající cenou ropy (Brent -1,6 % na 92,90 USD za barel). V Asii jsme přes noc viděli pokles regionálního indexu kolem -1 %. Dnes se také soustředí pozornost na vystoupení MF USA Bessenta. Z korporátních zpráv dominuje úpis nových akcií společnosti Alibaba v hodnotě 10 mld. USD v Hong Kongu (akcie reagují propadem). Shell prodává americkou chemickou divizi. Praha v pátek posílila +0,6 %, dnes může index PX reagovat na mírně horší sentiment.
Nvidia (NVDA.O) is in talks to invest in Perplexity as part of an equity funding round that would value the AI startup at more than $30 billion, The Information reported on Sunday, citing people with knowledge of the discussion.
The funding round would increase Perplexity's valuation by more than 50% from its previous financing a year ago, according to the report.
Perplexity's annualized revenue has risen to more than $750 million from less than $250 million at the start of the year, the report said. Part of the revenue growth has been driven by Perplexity Computer, a cloud-based AI agent used by professionals to automate computer-based tasks, the report added, citing people familiar with the matter.
Perplexity declined to comment on the Information report, while Nvidia did not immediately respond to a request for comment.
The Information reported in September last year that Perplexity had finalized a $20 billion valuation.
Earlier this year, Perplexity signed a $750 million agreement with Microsoft (MSFT.O) to use its Azure cloud service, according to a Bloomberg News report.
Perplexity is planning to go public in 2028 regardless of how the market receives the listings of Anthropic and OpenAI, CEO Aravind Srinivas told CNBC in an interview in June.
The startup's high-profile backers, along with Nvidia, include Amazon founder Jeff Bezos and Japan's SoftBank Group (9984.T).
My coverage of Nvidia (NVDA -0.98%) comes with an investing regret. Though I have covered it since 2017, I passed on adding shares because I perceived it as overvalued. Then, when it experienced retracements of over 50%, as it did in 2018 and 2022, I saw that as a pullback from its overvalued status.
Dismissing Nvidia as overvalued cost me the nearly 5,2300% gain it has made over the last nine years, and the 2018 sell-off that I thought was huge at the time barely shows up on its price chart today.
Moreover, even with that gain, its price-to-earnings ratio (P/E) is 33. At that number, I would argue that it is not overvalued, and here's why.
Image source: The Motley Fool.
Why I do not own Nvidia now Full disclosure: Nvidia is no longer my type of stock. For now, I only buy growth stocks with the long-term potential for 10-bagger growth or higher, or dividend stocks that offer a generous and growing stream.
Neither of these criteria describes Nvidia today. Although I believe it will continue to beat the S&P 500, I worry about the law of large numbers since its market cap is now around $5.2 trillion. This means that for it to rise 10-fold, its market cap would have to reach $52 trillion, a huge feat when no stock has yet reached $6 trillion.
As for its income potential, investors might wonder why I am not interested in its payout, given the 25-fold increase in the dividend in the last quarter. That increase is notable, but its dividend yield remains under 0.5%, well below the S&P 500 return of more than 1%.
The state of Nvidia stock However, it remains an excellent stock to hold, and even a buy for other types of investors. With regard to that 33 P/E ratio, it's only slightly above the S&P 500 average of 30.
Furthermore, Nvidia isn't growing like a company trading at 33 times earnings. In the first quarter of fiscal 2027 (ended April 26), revenue increased by 85% to nearly $82 billion. Also, because it kept expense growth in check, net income grew 211% to $58 billion.
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This is not a one-time event, either. Revenue grew 65% in fiscal 2026, and analysts forecast a 97% increase in the coming quarter. Also, it holds over $80 billion in liquidity, and since it spent only $6.6 billion on capital expenditures (capex) over the last year, it is in an extremely strong financial position.
Obviously, 33 times earnings is a low price for such a company and arguably pays investors to deal with the worries surrounding Nvidia, which they should understand.
Signs of concern Some investors like me may be looking for growth that is unhampered by the law of large numbers. Analysts forecast a 44% revenue increase in fiscal 2028. That is still huge for a company of Nvidia's size, but it also represents a substantial slowdown from past years.
Others may worry about the sustainability of the AI building boom. The top four hyperscalers plan $760 billion in capex in 2026 alone. That level of spending leaves investors wondering how much longer it can continue to grow.
And some analysts claim that Nvidia is engaging in circular financing, in which it funds customer purchases that help sustain its growth. Management recently announced it had a memorandum of understanding with six major Wall Street investment firms to provide $500 billion for artificial intelligence (AI) infrastructure.
Time will tell whether that eases investor concerns. Circular financing contributed to the demise of Lucent and Nortel in the early 2000s. Nvidia's liquidity should insulate it from such an outcome, but it may not avert a stock sell-off if an AI bust occurs.
Nvidia and valuation As conditions stand today, I think it's an undervalued stock, and I regret not buying when I started covering it nine years ago.
It's still not a stock for everyone. The law of large numbers will likely slow growth. Also, if efforts to finance the AI infrastructure boom fall through, the 33 P/E ratio may not be low enough to avert a sell-off.
Nonetheless, that valuation is extremely low given its revenue growth. And even if the feared AI bust occurs, its growth should continue, just as internet use kept growing after the dot-com bust. Thus, for anyone looking for a safe place to store wealth while earning long-term returns, I believe Nvidia should remain an excellent choice.
Ryan Shrout examines Nvidia's (NVDA) setup ahead of its upcoming earnings report, including expectations for CEO Jensen Huang and the rollout of the company's Vera Rubin technology. He also discusses Nvidia's competitive advantages, the durability of its GPU leadership and the challenge posed by rivals such as AMD Inc. (AMD).
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Some of Nvidia’s largest customers have been told prices of servers containing its AI chips will rise by more than 15% in many cases with memory chip costs soaring, Bloomberg News reported on Saturday.
The price hikes will go into effect on systems shipped early next year and will impact systems including those with the flagship Vera Rubin and Grace Blackwell chips, the report added, citing people familiar with the process. The increases will depend on Nvidia’s chip generation and memory configurations, they said.
The price hikes for Nvidia customers will go into effect next year, Reuters reported. REUTERS Reuters couldn’t immediately verify the report. Nvidia did not immediately respond to a request for comments outside regular business hours.
Companies that build servers under contract for large data center operators such as Microsoft, Alphabet Inc.’s Google and Oracle have recently informed their customers of the upcoming increases, the report added.
Nvidia, whose chips underpin much of the AI infrastructure buildout, is set to report second-quarter results on Wednesday.
The company has become a proxy for the broader AI ecosystem spanning chip makers and companies financing the rapid expansion of data center capacity.
Nvidia (NVDA -0.98%) stock has been a disappointment for some investors in 2026. The stock price is up 15%, which is beating the broader market's 12% rise, but it isn't outperforming the way it has in the previous three years. In 2026, Nvidia has reported strong results so far that suggest the growth thesis continues, yet the market has grown skeptical.
This makes now a great time to consider buying. Just know that the window could be closing fast. On Wednesday, Aug. 26, Nvidia reports fiscal 2027 second-quarter results (for the quarter ending July 30). Because Nvidia is valued at an attractive level heading into earnings, this could be the last chance investors have to buy the stock cheaply, as there is a good shot the stock experiences a strong, significant rally following the report.
Given its continued stellar growth rate and reasonable valuation, I can think of few stocks that are better buys. All of that could change depending on the quality of Nvidia's earnings and the market's reaction afterward.
Image source: The Motley Fool.
Nvidia stock is cheap compared to its peers Nvidia makes computing equipment, with most of its products centered around its GPU ecosystem. Nvidia GPUs are the industry standard in AI computing right now, and nearly every product that launches is compared to theirs. So, checking Nvidia's valuation versus its competitors is a smart move.
In the AI computing world, there are two primary types of computing units being deployed: Broad-purpose GPUs and custom AI chips. Advanced Micro Devices (AMD +0.81%) is a competitor in the eGPU space, while Broadcom (AVGO +1.21%) and Marvell Technology (MRVL -5.57%) are both competitors in the custom AI chip industry.
When all four of them are compared, Nvidia has by far the lowest valuation from a trailing price-to-earnings (P/E) perspective.
Data by YCharts.
However, the trailing P/E ratio leaves out one important factor: Growth. All four of these companies are rapidly expanding, so incorporating future growth projections is a smart idea for investors. By using the forward P/E ratio, we can incorporate growth projections for this fiscal year for each company. From this standpoint, Nvidia is still the cheapest stock.
Data by YCharts.
No matter how you slice it, Nvidia's stock is incredibly cheap compared to its peers. Furthermore, at only 24 times forward earnings, it's not that much more expensive than the S&P 500, which trades at 21.4 times forward earnings. With Nvidia barely holding a premium to the broader market, I'd say it's a pretty cheap stock for the growth it's delivering.
Data by YCharts.
If Nvidia blows expectations out of the water (Wall Street analysts currently expect 97% year-over-year growth), Nvidia's stock could be primed to rise, as it's starting at a relatively low valuation point. I think there's a good chance that it will kick-start a huge rally to end the year, making Nvidia a no-brainer stock to buy before Aug. 26.
Keithen Drury has positions in Broadcom and Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Broadcom, Marvell Technology, and Nvidia. The Motley Fool has a disclosure policy.
Listen below or on the go on Apple Podcasts and Spotify
Nvidia earnings put the AI trade back in focus. (0:33) Kevin Warsh heads to Jackson Hole as bond vigilantes stir. (1:32) Canada hits back with retaliatory tariffs on U.S. imports. (2:33)
The following is an abridged transcript:
The summer doldrums disappear with a huge week ahead for stocks and bonds.
Nvidia (NVDA) stars Wednesday with what has become the biggest earnings event on Wall Street. On Friday, Fed Chairman Kevin Warsh gives the keynote address at the Jackson Hole Symposium at a time when bond vigilantes are stirring.
With Nvidia, investors will be looking for updates on AI infrastructure demand, product ramp timing, China exposure and the economics of the chipmaker's expanding financing partnerships. Options traders are pricing in a roughly 6% move in Nvidia shares following the report.
Seeking Alpha analyst Mott Capital said investors and traders may be left with "the post-Nvidia earnings hangover" again if the numbers are good but not spectacular.
"A decline could be sharp, pushing the stock down by as much as 11% to an important area of technical and options-related support at $190, while upside seems limited," they said.
The results could reverberate across the semiconductor and AI complex. Marvell Technology (MRVL), Micron (MU), Arm (ARM) and Advanced Micro Devices (AMD) have shown some of the closest trading correlations with Nvidia following earnings.
Here's how the rest of the earnings calendar shapes up:
PDD Holdings (PDD) and XPeng (XPEV) report Monday.
Intuit (INTU) reports Tuesday.
On Wednesday, Nvidia is joined by CrowdStrike (CRWD), Salesforce (CRM), HP Inc. (HPQ) and Okta (OKTA).
Marvell (MRVL) and Ulta Beauty (ULTA) report Thursday.
Looking to Jackson Hole, Warsh will speak at 10 a.m. ET Friday.
At his last press conference, Warsh indicated that higher Treasury yields were doing the job of tightening financial conditions for the Fed. But since then, higher yields have spooked the White House, leading Treasury Secretary Scott Bessent to boost buybacks of longer-dated debt in an attempt to tamp down rates.
Seeking Alpha analyst Geneva Investor says "the two men want opposite things in the long end."
"Bessent wants the 10-year and 30-year lower, and has said so repeatedly," they said. "Warsh wants a smaller Fed footprint concentrated at the front end of the yield curve, which mechanically raises the long end."
"Bessent wants a larger FIMA facility, which expands the balance sheet. Warsh wants the $6.7T balance sheet to come down."
Seeking Alpha analyst Damir Tokic said Warsh will be under the spotlight to address the current bond market selloff, "and he will restate that real rates are rising, while inflation expectations remain anchored, so that will be a dovish message."
"However, with this dovish message, the nominal long-term rates will continue to rise, steepening the yield curve," he added.
In the news this weekend, Canadian Prime Minister Mark Carney said his country will impose retaliatory tariffs on a wide range of U.S. imports starting Sept. 8 in response to the Trump administration's new 50% tariffs on Canadian goods.
His remarks came after weeks of trade negotiations between the two sides collapsed late Friday. The new U.S. tariffs, which could impact roughly $20B worth of Canadian exports, took effect immediately.
Meanwhile, President Trump posted on Truth Social that Canada has "charged our great farmers, for many years, massive amounts of Tariffs."
He added that "Canada wants the benefits of being a State, without being one!!!"
And for income investors, 3M (MMM) goes ex-dividend Monday, paying out on Sept. 11.
Hyatt (H) goes ex-dividend Thursday, with a Sept. 10 payout date.
T-Mobile (TMUS) and eBay (EBAY) go ex-dividend Friday. T-Mobile pays out on Sept. 10 and eBay on Sept. 11.
Earnings WatchNvidia is due to report earnings on Wednesday, and ‘a very broad universe of companies’ is tied to the themes that the chip giant represents
Nvidia was once nearly synonymous with the artificial-intelligence build-out. Now, there are a handful of other AI companies capturing investor attention as they rake in hefty profits.
But earnings results from the chip maker NVDA, which remains at the heart of the AI boom and has a market value of around $5 trillion, are still a closely watched macro event every three months. Even amid concerns about about circular dealmaking within the AI industry and the sustainability of high data-center spending, analysts expect the company’s profits to make up an ever-greater share of the S&P 500 index’s SPX overall earnings this year.
About the Author
Bill Peters is a Los Angeles–based MarketWatch reporter.
Britney Nguyen is a tech reporter covering Nvidia, chips and AI. You can find her on X at @britneycath.
Ahead of its highly anticipated August 26 earnings report, Nvidia (NASDAQ: NVDA) stock has extended its decline to six consecutive sessions.
The trend marks NVDA’s longest losing streak in four years and has raised questions about the stock’s near-term outlook.
The sell-off has pushed Nvidia shares from recent highs near $225 to $214, erasing roughly 5% of the company’s market value ahead of the closely watched earnings release.
NVDA one-week stock price chart. Source: Finbold The losing streak appears driven by earnings uncertainty rather than weakening AI fundamentals.
As the market’s leading AI stock, Nvidia faces exceptionally high expectations, meaning even strong results could trigger volatility if guidance falls short of investor hopes.
The broader semiconductor sector has also come under pressure as investors rotate away from high-growth technology stocks amid interest rate and valuation concerns.
NVDA stock price prediction Amid the bearish sentiment, Finbold turned to OpenAI’s ChatGPT artificial intelligence model to assess Nvidia’s short-term price outlook.
Based on the latest price action, earnings expectations, and AI demand trends, ChatGPT’s independent Nvidia stock prediction remains moderately bullish.
The base case assumes Nvidia reports revenue near $94 billion, delivers solid guidance, and confirms strong demand for its next-generation AI platforms.
Under this scenario, Nvidia stock could trade between $235 and $245 by late September 2026. A bullish outcome, assigned a 40% probability, could lift shares toward $255 following a strong earnings beat and guidance increase.
A neutral scenario, with a 35% probability, sees Nvidia trading between $210 and $230, while a bearish scenario, carrying a 25% probability, could push the stock to $195 to $205 if earnings or guidance disappoint.
Overall, the weighted average forecast points to a 30-day price target of about $236 per share.
Nvidia’s earnings expectations Notably, Wall Street expects Nvidia to report revenue of approximately $92 billion to $95 billion for the latest quarter, representing close to 100% year-over-year growth.
The company continues to benefit from strong demand for artificial intelligence infrastructure, with hyperscale cloud providers and AI firms investing aggressively in data centers powered by Nvidia’s chips.
Investors will be closely monitoring management’s commentary on demand for its Blackwell and Vera Rubin platforms, as well as forward guidance for the remainder of 2026 and into 2027.
This comes as reports also indicate Nvidia may raise prices on certain AI server systems by more than 15% due to rising memory costs, potentially supporting future revenue growth and margins.
$NVDA AI SERVER PRICES SET TO RISE 15%+
Some Nvidia customers have been notified that AI server prices will rise more than 15% in many cases for systems shipping early next year, including Vera Rubin and Grace Blackwell.
Bloomberg says the increases will vary by chip generation… pic.twitter.com/EI7viKSaD6
— Wall St Engine (@wallstengine) August 22, 2026 While Nvidia’s six-day losing streak is unusual, the pullback remains modest relative to the stock’s gains over the past year.
The company’s fundamentals continue to be supported by accelerating AI adoption, strong data center demand, and expectations for another quarter of exceptional revenue growth.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
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The AI boom is producing an unusual side effect: The machines being built to power artificial intelligence are making other technology more expensive. Memory prices have already surged, with server DRAM roughly doubling in the first quarter of 2026. Counterpoint Research reported an 80% to 90% quarter-over-quarter increase across DRAM, NAND, and HBM during the period. And the shortage isn’t disappearing quickly.
Deloitte expects meaningful new capacity won’t arrive until 2029 or 2030, while Gartner has projected the supply crunch will persist at least through the first half of 2027. Now the memory bill is reaching the industry’s biggest AI chipmaker.
Nvidia Is Passing The Memory Bill Along Nvidia (NASDAQ:NVDA | NVDA Price Prediction) has reportedly told major customers that servers containing its Grace Blackwell and next-generation Vera Rubin chips will cost more than 15% more in many configurations beginning with systems shipped early next year.
Bloomberg reported the increases, though Reuters said the report’s details could not immediately be independently verified. Contract manufacturers building systems for Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOG), and Oracle (NYSE:ORCL) have already notified customers of the coming increases. The size of the hike will vary according to the Nvidia generation and memory configuration.
It’s not that Nvidia suddenly found that its GPUs cost 15% more to manufacture. Rather, memory is becoming one of the most expensive ingredients in the AI server recipe, particularly high-bandwidth memory (HBM), and server DRAM.
Deloitte estimates memory already represents roughly 25% of the bill of materials for high-end AI server racks. That gives suppliers enormous leverage when demand is rising faster than factories can add capacity.
The AI boom has a price tag—and you're paying it. From server chips to Kindles, a massive memory squeeze is driving tech costs to the breaking point. The AI Boom Is Creating “AI-Flation” The pricing pressure has already escaped the data center. Apple (NASDAQ:AAPL) raised prices on Macs, iPads, Apple TV, HomePod, and Vision Pro products in June, with some increases approaching 20%. CEO Tim Cook specifically blamed soaring memory and storage costs driven by AI data-center construction.
Now Amazon (NASDAQ:AMZN) is following its lead. Fortune reported that Amazon raised prices on Echo, Fire TV, Kindle, and eero products, including a 60% increase for the Echo Dot from $49.99 to $79.99 and a 37% increase for the base Kindle from $109.99 to $149.99. Amazon said the increases reflected “significant increases” in memory and storage component costs.
The pattern is important for investors. AI isn’t merely consuming electricity and GPUs. It is bidding up the price of the underlying components needed to build those systems. And the pressure could worsen. Gartner’s forecast calls for the shortage to last into 2027, while Deloitte expects AI-server DRAM prices to quadruple over the full year from their starting point.
Nvidia May Be A Winner Anyway Ironically, higher memory prices could strengthen Nvidia’s position rather than weaken it.
Demand for Nvidia’s AI infrastructure remains strong enough that hyperscalers appear willing to absorb higher costs. Passing memory inflation through to Microsoft, Google, Oracle, and other customers allows Nvidia to protect its own economics instead of absorbing the entire increase.
The bigger concern is what happens to the cost of building AI data centers. A 15% increase in server prices doesn’t make the AI investment boom stop, but it does raise the capital required to deploy the same amount of computing capacity. That’s AI-flation in its simplest form.
Granted, there is a longer-term risk for Nvidia. If AI infrastructure becomes too expensive, hyperscalers have an even greater incentive to develop custom silicon and diversify away from Nvidia’s platform.
But that transition takes time, while the memory shortage is happening now.
Key Takeaway For investors, the memory squeeze is better news for memory makers than for Nvidia customers. Micron Technology (NASDAQ:MU), SK hynix (NASDAQ:SKHY), and Samsung stand to benefit from pricing power created by scarce supply. Nvidia, meanwhile, is demonstrating that its demand remains strong enough to pass those costs along.
In short, investors shouldn’t dismiss the 15% Nvidia price increase as a minor cost adjustment. It is evidence that the AI boom is moving into its next phase — one where memory scarcity is becoming an inflationary force across the entire technology supply chain.
Contact [email protected] for any questions or corrections.
Canvas Wealth Advisors LLC lowered its position in NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 5.4% during the second quarter, according to its most recent filing with the SEC. The institutional investor owned 115,127 shares of the computer hardware maker’s stock after selling 6,613 shares during the period. NVIDIA accounts for approximately 3.2% of Canvas Wealth Advisors LLC’s portfolio, making the stock its 8th biggest holding. Canvas Wealth Advisors LLC’s holdings in NVIDIA were worth $23,036,000 at the end of the most recent quarter.
Several other institutional investors and hedge funds also recently added to or reduced their stakes in NVDA. Defender Capital LLC. increased its holdings in shares of NVIDIA by 0.7% in the second quarter. Defender Capital LLC. now owns 7,534 shares of the computer hardware maker’s stock valued at $1,507,000 after purchasing an additional 50 shares during the last quarter. Spectrum Financial Alliance Ltd LLC increased its stake in shares of NVIDIA by 3.8% in the 1st quarter. Spectrum Financial Alliance Ltd LLC now owns 1,395 shares of the computer hardware maker’s stock worth $243,000 after acquiring an additional 51 shares during the last quarter. LMG Wealth Partners LLC raised its holdings in shares of NVIDIA by 0.7% during the 4th quarter. LMG Wealth Partners LLC now owns 7,649 shares of the computer hardware maker’s stock worth $1,427,000 after acquiring an additional 53 shares during the period. Vision Financial Markets LLC raised its holdings in shares of NVIDIA by 1.2% during the 3rd quarter. Vision Financial Markets LLC now owns 4,640 shares of the computer hardware maker’s stock worth $866,000 after acquiring an additional 53 shares during the period. Finally, JGP Global Gestao de Recursos Ltda. boosted its position in shares of NVIDIA by 2.3% during the 4th quarter. JGP Global Gestao de Recursos Ltda. now owns 2,402 shares of the computer hardware maker’s stock valued at $448,000 after acquiring an additional 55 shares during the last quarter. Institutional investors and hedge funds own 65.27% of the company’s stock.
NVIDIA Stock Down 1.0% Shares of NASDAQ NVDA opened at $214.75 on Friday. The stock has a market cap of $5.20 trillion, a P/E ratio of 32.89, a PEG ratio of 0.43 and a beta of 2.23. The business’s fifty day simple moving average is $207.47 and its 200-day simple moving average is $199.52. NVIDIA Corporation has a 12-month low of $164.07 and a 12-month high of $236.54. The company has a current ratio of 3.44, a quick ratio of 2.85 and a debt-to-equity ratio of 0.04.
NVIDIA (NASDAQ:NVDA – Get Free Report) last issued its earnings results on Wednesday, May 20th. The computer hardware maker reported $1.87 earnings per share for the quarter, beating the consensus estimate of $1.76 by $0.11. The firm had revenue of $81.61 billion for the quarter, compared to analysts’ expectations of $78.42 billion. NVIDIA had a net margin of 62.97% and a return on equity of 96.94%. The firm’s revenue was up 85.2% compared to the same quarter last year. During the same quarter last year, the company earned $0.81 earnings per share. As a group, equities analysts predict that NVIDIA Corporation will post 8.8 EPS for the current fiscal year. NVIDIA declared that its Board of Directors has authorized a stock repurchase plan on Wednesday, May 20th that authorizes the company to repurchase $80.00 billion in outstanding shares. This repurchase authorization authorizes the computer hardware maker to purchase up to 1.5% of its stock through open market purchases. Stock repurchase plans are often a sign that the company’s management believes its stock is undervalued.
Analysts Set New Price Targets A number of analysts have recently issued reports on NVDA shares. Wells Fargo & Company restated an “overweight” rating and set a $315.00 price target on shares of NVIDIA in a report on Tuesday, August 11th. Bank of America reiterated a “buy” rating and issued a $350.00 price objective (up from $320.00) on shares of NVIDIA in a report on Thursday, May 21st. Stifel Nicolaus set a $282.00 price objective on NVIDIA and gave the stock a “buy” rating in a research report on Thursday, May 21st. Itau BBA Securities cut their target price on NVIDIA from $256.00 to $218.00 in a research note on Wednesday, June 24th. Finally, TD Cowen restated a “buy” rating on shares of NVIDIA in a research report on Tuesday. Three research analysts have rated the stock with a Strong Buy rating, forty-nine have assigned a Buy rating and two have assigned a Hold rating to the stock. According to MarketBeat.com, the company presently has a consensus rating of “Buy” and a consensus price target of $308.01.
Read Our Latest Stock Analysis on NVDA
NVIDIA News Summary Here are the key news stories impacting NVIDIA this week:
Positive Sentiment: NVIDIA is reportedly in advanced talks to invest several hundred million dollars in Cloverleaf Infrastructure, a developer of U.S. data-center power and infrastructure. The move could help address the electricity bottleneck limiting AI capacity while strengthening NVIDIA’s role in projects that use its systems. Nvidia in Talks to Invest in Data-Center Power Developer Cloverleaf Infrastructure Positive Sentiment: Analyst support remains strong before earnings. BMO named NVIDIA its top semiconductor pick with a $340 price target, while Jefferies reportedly expects revenue to exceed consensus by roughly $3 billion. Consensus forecasts call for approximately $91 billion of quarterly revenue, supported by Blackwell and broader AI infrastructure demand. Nvidia stock dubbed top pick ahead of Q2 earnings Positive Sentiment: Reports that SpaceX is standardizing its AI infrastructure on NVIDIA chips reinforce the company’s competitive position and could support demand for its next-generation Vera Rubin platform. NVIDIA is also exploring a potential partnership or acquisition involving South Korean AI-chip designer Rebellions, indicating continued investment in its AI ecosystem. NVIDIA Could Snap up Korean AI Chip Startup Rebellions Neutral Sentiment: NVIDIA’s proposed investment in Cloverleaf follows other efforts to finance AI infrastructure and convert future GPU capacity into a financeable asset. The strategy could accelerate deployments, but it also exposes NVIDIA to capital-allocation and customer-financing risks. Nvidia Makes Another Bet on the AI Power Bottleneck Negative Sentiment: Investors are weighing possible competitive and product risks. NVIDIA is reportedly testing Rubin Ultra configurations with less high-bandwidth memory than originally planned, while Microsoft is preparing its own Maia 300 AI chip. These developments could raise questions about performance, supply availability and long-term customer diversification. NVIDIA and AMD: Rubin Ultra memory reports Negative Sentiment: NVIDIA denied a report that it plans small-batch shipments of a China-specific AI chip by year-end, removing a potential near-term catalyst. Analysts also say any renewed China H200 sales may have only a limited effect on revenue. Nvidia to ship AI chip for China by year-end Negative Sentiment: Higher Treasury yields and warnings from investors such as Michael Burry that AI data-center financing may be excessive are adding valuation pressure ahead of a high-expectation earnings event. Insider Activity In other NVIDIA news, Director Stephen C. Neal sold 15,500 shares of the company’s stock in a transaction on Wednesday, June 3rd. The shares were sold at an average price of $215.73, for a total value of $3,343,815.00. Following the completion of the transaction, the director owned 116,135 shares in the company, valued at $25,053,803.55. This represents a 11.77% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, Director Mark A. Stevens sold 885,000 shares of the company’s stock in a transaction dated Thursday, June 18th. The shares were sold at an average price of $210.17, for a total value of $186,000,450.00. Following the completion of the sale, the director directly owned 5,207,271 shares of the company’s stock, valued at approximately $1,094,412,146.07. This trade represents a 14.53% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last 90 days, insiders have sold 1,901,125 shares of company stock worth $410,583,015. 3.94% of the stock is currently owned by insiders.
NVIDIA Profile (Free Report)
NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.
The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.
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Family Wealth Partners LLC trimmed its holdings in NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 62.6% in the 2nd quarter, according to its most recent filing with the SEC. The institutional investor owned 1,859 shares of the computer hardware maker’s stock after selling 3,110 shares during the quarter. Family Wealth Partners LLC’s holdings in NVIDIA were worth $372,000 at the end of the most recent reporting period.
Other hedge funds have also bought and sold shares of the company. Lifetime Wealth Management P.C. bought a new position in shares of NVIDIA during the 4th quarter valued at $26,000. Longview Financial Advisors Inc. bought a new position in NVIDIA in the first quarter valued at about $27,000. Longfellow Investment Management Co. LLC boosted its position in NVIDIA by 47.9% in the second quarter. Longfellow Investment Management Co. LLC now owns 207 shares of the computer hardware maker’s stock worth $33,000 after purchasing an additional 67 shares during the last quarter. Phillip James Consulting Co. purchased a new position in NVIDIA in the first quarter worth about $40,000. Finally, Spurstone Advisory Services LLC bought a new stake in shares of NVIDIA during the 2nd quarter valued at about $40,000. Hedge funds and other institutional investors own 65.27% of the company’s stock.
Insider Activity In other news, Director Mark A. Stevens sold 885,000 shares of NVIDIA stock in a transaction that occurred on Thursday, June 18th. The stock was sold at an average price of $210.17, for a total value of $186,000,450.00. Following the completion of the transaction, the director owned 5,207,271 shares in the company, valued at approximately $1,094,412,146.07. The trade was a 14.53% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, Director John Dabiri sold 625 shares of the business’s stock in a transaction on Wednesday, May 27th. The shares were sold at an average price of $214.00, for a total transaction of $133,750.00. Following the transaction, the director owned 14,163 shares in the company, valued at $3,030,882. This trade represents a 4.23% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 1,901,125 shares of company stock valued at $410,583,015 in the last ninety days. Insiders own 3.94% of the company’s stock.
Key Headlines Impacting NVIDIA Here are the key news stories impacting NVIDIA this week: Positive Sentiment: NVIDIA is reportedly in advanced talks to invest several hundred million dollars in Cloverleaf Infrastructure, a developer of U.S. data-center power and infrastructure. The move could help address the electricity bottleneck limiting AI capacity while strengthening NVIDIA’s role in projects that use its systems. Nvidia in Talks to Invest in Data-Center Power Developer Cloverleaf Infrastructure Positive Sentiment: Analyst support remains strong before earnings. BMO named NVIDIA its top semiconductor pick with a $340 price target, while Jefferies reportedly expects revenue to exceed consensus by roughly $3 billion. Consensus forecasts call for approximately $91 billion of quarterly revenue, supported by Blackwell and broader AI infrastructure demand. Nvidia stock dubbed top pick ahead of Q2 earnings Positive Sentiment: Reports that SpaceX is standardizing its AI infrastructure on NVIDIA chips reinforce the company’s competitive position and could support demand for its next-generation Vera Rubin platform. NVIDIA is also exploring a potential partnership or acquisition involving South Korean AI-chip designer Rebellions, indicating continued investment in its AI ecosystem. NVIDIA Could Snap up Korean AI Chip Startup Rebellions Neutral Sentiment: NVIDIA’s proposed investment in Cloverleaf follows other efforts to finance AI infrastructure and convert future GPU capacity into a financeable asset. The strategy could accelerate deployments, but it also exposes NVIDIA to capital-allocation and customer-financing risks. Nvidia Makes Another Bet on the AI Power Bottleneck Negative Sentiment: Investors are weighing possible competitive and product risks. NVIDIA is reportedly testing Rubin Ultra configurations with less high-bandwidth memory than originally planned, while Microsoft is preparing its own Maia 300 AI chip. These developments could raise questions about performance, supply availability and long-term customer diversification. NVIDIA and AMD: Rubin Ultra memory reports Negative Sentiment: NVIDIA denied a report that it plans small-batch shipments of a China-specific AI chip by year-end, removing a potential near-term catalyst. Analysts also say any renewed China H200 sales may have only a limited effect on revenue. Nvidia to ship AI chip for China by year-end Negative Sentiment: Higher Treasury yields and warnings from investors such as Michael Burry that AI data-center financing may be excessive are adding valuation pressure ahead of a high-expectation earnings event. Analyst Upgrades and Downgrades Several analysts recently issued reports on the stock. Craig Hallum boosted their target price on shares of NVIDIA from $245.00 to $275.00 and gave the company a “buy” rating in a research report on Thursday, May 21st. Seaport Research Partners increased their price target on shares of NVIDIA from $140.00 to $180.00 and gave the stock a “sell” rating in a research report on Thursday, May 21st. Mizuho set a $300.00 price target on shares of NVIDIA in a research note on Thursday, May 21st. Itau BBA Securities cut their price objective on shares of NVIDIA from $256.00 to $218.00 in a research report on Wednesday, June 24th. Finally, Argus upped their price objective on NVIDIA from $220.00 to $270.00 and gave the stock a “buy” rating in a research note on Thursday, May 21st. Three investment analysts have rated the stock with a Strong Buy rating, forty-nine have issued a Buy rating and two have given a Hold rating to the company. Based on data from MarketBeat, the stock has a consensus rating of “Buy” and a consensus target price of $308.01.
Read Our Latest Report on NVIDIA
NVIDIA Stock Performance Shares of NASDAQ NVDA opened at $214.75 on Friday. NVIDIA Corporation has a 52-week low of $164.07 and a 52-week high of $236.54. The company has a debt-to-equity ratio of 0.04, a quick ratio of 2.85 and a current ratio of 3.44. The firm’s fifty day moving average is $207.47 and its two-hundred day moving average is $199.52. The company has a market cap of $5.20 trillion, a P/E ratio of 32.89, a P/E/G ratio of 0.43 and a beta of 2.23.
NVIDIA (NASDAQ:NVDA – Get Free Report) last posted its earnings results on Wednesday, May 20th. The computer hardware maker reported $1.87 EPS for the quarter, beating analysts’ consensus estimates of $1.76 by $0.11. NVIDIA had a return on equity of 96.94% and a net margin of 62.97%.The firm had revenue of $81.61 billion during the quarter, compared to the consensus estimate of $78.42 billion. During the same period in the prior year, the company earned $0.81 EPS. The company’s quarterly revenue was up 85.2% compared to the same quarter last year. As a group, analysts anticipate that NVIDIA Corporation will post 8.8 EPS for the current fiscal year.
NVIDIA announced that its Board of Directors has authorized a share buyback plan on Wednesday, May 20th that permits the company to buyback $80.00 billion in shares. This buyback authorization permits the computer hardware maker to purchase up to 1.5% of its shares through open market purchases. Shares buyback plans are often an indication that the company’s leadership believes its stock is undervalued.
NVIDIA Company Profile (Free Report)
NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.
The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.
Recommended Stories Five stocks we like better than NVIDIA 2 Biotech Stocks Shaping Up for Major Breakouts 3 Stocks Came Roaring Back—Now They’re Flashing Warning Signs 3 Beaten-Down Stocks That Haven’t Gotten the Message About the S&P 500’s Record Run Darden Restaurants Just Hit a 52-Week High–Is the Olive Garden Comeback Story Legit? Want to see what other hedge funds are holding NVDA? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for NVIDIA Corporation (NASDAQ:NVDA – Free Report).
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Nvidia (NVDA -0.98%) currently sits around a $5.25 trillion market cap -- a fair bit over second-place Apple at a $4.5 trillion market cap. However, I think this gap will widen quickly, and it all starts this week after Nvidia reports second-quarter earnings on Aug. 26.
After that, I believe that Nvidia's stock will produce a major rally, and lead to it being valued at greater than a $6 trillion valuation by the end of 2026.
That makes it a no-brainer buy before earnings, as that indicates about a 14% upside -- about double what Nvidia's stock has returned so far this year. Nvidia looks like a smart buy now, and is destined to set new records after Q2 results are available.
Image source: Nvidia.
Nvidia is no stranger to exceeding expectations With Nvidia, exceeding expectations has become the norm. For Q4 FY 2026, Nvidia expected $65 billion in revenue; it ended up producing $68 billion. For Q1 FY 2027, management guided for $78 billion, yet Nvidia generated $82 billion. This level of outperformance has become the expectation, and with Nvidia projecting $91 billion in revenue for Q2, most investors are likely expecting something in the $93 billion to $94 billion range. Why is that a big deal? Because during Q2 of last year, Nvidia generated $46.7 billion in revenue, which would require revenue of $93.4 billion to double its revenue year over year.
For a company of Nvidia's size to be doubling its revenue is nothing short of incredible, and could reignite a rally due to Nvidia's accelerating growth rate.
NVDA Revenue (Quarterly YoY Growth) data by YCharts
Furthermore, Nvidia doesn't have that high of expectations coming into earnings. In 2024 and 2025, Nvidia was trading at about 35 times forward earnings entering Q2 earnings. This year? It's a mere 24 times forward earnings.
NVDA PE Ratio (Forward) data by YCharts
If Nvidia reports a blowout quarter and gives strong Q3 guidance, this could ignite a rally in the stock and push Nvidia to levels that it normally trades at during this time of year: about 35 times forward earnings. If Nvidia can do that, it would push it to heights never before seen by a company.
The road to a $6 trillion valuation is clear The first step is for Nvidia to report a strong quarter, which I think is a given at this point. There haven't been any major industry shifts to indicate that Nvidia is in trouble, and I think solid results are a foregone conclusion.
The next step will be for Nvidia's stock to rise to 35 times forward earnings. Should Nvidia's stock do that, it would rise 46% from today's levels. Where does that put its market cap? Well above the $6 trillion threshold.
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A 46% gain from today's $5.25 trillion market cap actually yields a $7.65 trillion company -- well beyond the levels I'm looking for. Nvidia only needs 14% to get to $6 trillion, so I think it's a pretty solid bet that Nvidia will reach $6 trillion shortly after earnings. That makes it a strong stock pick today, and even if it doesn't rise to its standard valuation, I think 2027 will be a great year for the stock because it will enter the year trading at a pretty low valuation for its growth.
The AI buildout isn't slowing anytime soon. With Nvidia at the center of the computing power that those data centers use, it makes for a strong buy right now.
SummaryNvidia faces elevated expectations ahead of earnings, with the market pricing in strong growth and a high bar for outperformance.Options and technical analysis indicate asymmetric post-earnings risk, with limited upside and potential for a sharp decline to $190 support.Positive gamma positioning may cap NVDA’s upside while slowing initial declines, but a break below $210 could accelerate downside volatility.Despite a history of beating estimates, NVDA’s post-earnings moves often remain within options-implied ranges, limiting outsized gains.Looking for more investing ideas like this one? Get them exclusively at Reading The Markets. Learn More »GummyBone/iStock Editorial via Getty Images
Nvidia (NVDA) will report results on Wednesday, August 26, and, once again, the market is setting the bar high ahead of the report. The company has beaten analysts' earnings and revenue estimates every quarter since the fiscal fourth quarter of
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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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SummaryThe Invesco S&P 500 Top 50 ETF retains a buy rating, supported by attractive valuation and balanced style exposure.XLG trades at a 21.2x P/E and a PEG below 2.0x, with a 12.1% long-term EPS growth rate, enhancing its value proposition.Near-term risks include bearish seasonality, technical stagnation, and rising interest rates due to mega-cap debt issuance.Upcoming NVDA earnings and September volatility are key catalysts; XLG offers concentrated exposure to US mega-caps, especially in tech. jsnover/iStock via Getty Images
A big week for US mega-caps is on tap. Treasury Secretary Scott Bessent speaks on Monday; we'll get PCE inflation data on Wednesday morning, and Fed Chair Kevin Warsh speaks from the shadows of the Grand Tetons in
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Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
When someone asks me to name the best semiconductor stock to buy for now and the next few years, my answer is Nvidia (NVDA -0.98%). I look at plenty of other chip names, including Broadcom and Advanced Micro Devices, yet I keep coming back to Nvidia because it sits at the center of how artificial intelligence (AI) is built and used, not just at the edge of the hardware market.
The core of the story is Nvidia's data center business. In the most recent fiscal year (ended Jan. 25, 2026), Nvidia reported quarterly data center revenue of $62.3 billion, up 75% year over year, and full-year data center sales are expected to be in the neighborhood of $180 billion. These are massive numbers and show that data centers are the main engine for the company. When hyperscalers and enterprises decide how many AI clusters to build, they start with Nvidia's platform, then layer everything else around it.
The company's platform is not just about a single AI chip. The company's Blackwell architecture connects hundreds of billions of transistors, custom interconnects, and massive pools of memory into unified graphics processing units (GPUs), then scales those GPUs into rack-level systems like GB200 and GB300 that act like giant accelerators. On top of those systems sit DGX SuperPODs, Grace CPUs, and software like CUDA and TensorRT that developers already know and trust. When I picture the AI factories that companies are building, I see Nvidia in the center of the blueprints.
Image source: Getty Images.
Nvidia is the early AI stock All the above is the technical side. The psychological side matters, too. Nvidia has become the default AI stock for many investors. It is the ticker people think of when they hear about new models, new data centers, or new AI enterprise rollouts. Analysts often mention Nvidia first when discussing AI infrastructure, and the stock still carries a broad buy rating and targets pointing to meaningful upside from current levels. That attention can create volatility, yet it also means the company gets a steady stream of capital and scrutiny, which pushes management to keep delivering.
I also look at how Nvidia behaves as a business, not just as a chip designer. It invests in glassmakers, fiber suppliers, networking partners, and data center builders so that the broader ecosystem has what it needs to keep expanding. Nvidia has committed billions of dollars to companies like Corning and data center joint ventures that will eventually become customers for more GPUs and systems. This feels like a company that understands the whole AI stack and is positioning itself to benefit at multiple layers.
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Risks regarding Nvidia There are risks. Custom application-specific integrated circuits (ASICs) from Broadcom and others are gaining share in certain workloads, and forecast data suggests GPU servers may represent around 70% of AI server shipments, with ASIC servers approaching 30%. Competition is real. At the same time, Nvidia is pushing new platforms like Blackwell Ultra and Rubin to handle inference, reasoning, and agent-style AI, which shows the company is not standing still while others chase inference efficiency.
For me, the key question is simple: Which semiconductor stock sits closest to the decisions that matter for AI spending? When a cloud provider or a bank plans a new AI system, Nvidia is usually the first name in the room. Its hardware, software, and reference designs still define what an AI cluster looks like, and its data center revenue and backlog tell me customers are willing to keep paying for that leadership.
So when I answer that Nvidia is the top semiconductor stock for 2027 and beyond, I am not just repeating a popular view. I am looking at a company that sells the core of the AI factory, shapes how developers build models, and positions itself along the whole infrastructure chain. If I want exposure to AI chips with the strongest mix of technology, Nvidia is the name I own first and size around everything else.
Nvidia stock price dropped sharply last week as traders refocused on the upcoming earnings report that will provide insights into its revenue and profitability growth. NVDA will also react to news on GPU price hikes, which may boost its revenue in the foreseeable future.
Nvidia, the world’s largest company, is hiking product prices, a move that could boost its revenue and profits but also carries risks.
According to Bloomberg, the company has already notified its biggest clients about these price hikes that will mostly affect products shipped in 2028. The report notes that the hikes will include systems with the flagship Vera Rubin and Grace Blackwell chips.
Nvidia cites the rising cost of doing business, including memory and other servers.
These hikes will help the company to boost its revenues this year and in the coming years. For this year, customers may decide to front-load the purchases to avoid the price hikes.
On the other hand, the price increases may have some major risks. For one, there is a possibility that some of its customers will decide to increase their pivot towards their internal chips and also alternatives.
While Amazon uses a lot of Nvidia chips, it is also working on improving its Trainium chips. These chips are the ones powering most of Anthropic’s AI training.
Microsoft has Maia chips, while Google and Meta Platforms have Maia and MTIA. Last week, Google expanded its partnership with Marvell Technology to accelerate the production of its TPU chips.
In addition to these companies, other top semiconductor firms are boosting their production of AI chips that may compete with Nvidia. The most notable ones are firms like Cerebras, Etched, and AMD.
The next important catalyst for the NVDA stock price is its upcoming earnings report that will provide more information about its growth. Based on the last earnings reports by its clients and suppliers, chances are that its revenues and profits will be better than expected.
Analysts expect the upcoming earnings report to show that Nvidia’s revenue and profits surged last quarter. Its revenue growth is expected to be 96%, which would bring its revenue to $92 billion.
Its guidance for the third quarter is expected to be $103 billion. In reality, since Nvidia normally beats forecasts, chances are that the real figures will be $96 billion and $112 billion, respectively.
Nvidia’s earnings and revenues beat rarely moves the stock. One approach that may do the trick is a larger share buyback than the $80 billion it announced a few months ago. It would justify a bigger repurchase by focusing on its cheap valuation.
NVDA stock chart | Source: TradingView
The four-hour chart shows that the NVDA stock has dropped in the past few days, moving from a high of $227 to the current $214.75. It has already moved slightly below the 25-period Exponential Moving Average (EMA).
The stock has now retested the crucial support level of $214, its highest point on July 25. It has also stabilized at the 50-period Exponential Moving Average (EMA).
Therefore, there is a possibility that the stock will bounce back, potentially to the key resistance level of $227. A drop below the support level of $200 will invalidate the bullish outlook,
A sweeping agreement with startup Poolside aims to build an open artificial-intelligence ecosystem in the U.S. that would compete with Chinese heavyweights and American AI giants.
Nvidia plans to hike prices for some of its largest customers, Bloomberg News reported Saturday.
The chipmaker is set to increase the cost of servers containing its artificial intelligence chips, including Vera Rubin and Grace Blackwell, by more than 15% in many cases, according to the outlet. The price gains will reportedly depend on the chip generation and memory configurations.
Customers can expect the price increase to take effect on systems shipped next year, Bloomberg said.
Nvidia has been facing the soaring costs of memory chips, which are essential for its GPUs and systems.
Nvidia (NVDA -0.98%) looks like it's slowing sharply, but the headline growth rate may be hiding what's actually happening. China, tight supply, and a product transition are clouding the picture, while earnings continue to grow much faster than the stock price. The next revenue guide could reveal whether investors are seeing a genuine demand crack or a temporary bottleneck.
Stock prices used were the market prices of Aug. 15, 2026. The video was published on Aug. 20, 2026.
Rick Orford has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. Rick Orford is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link, they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.
Some of Nvidia's (NVDA.O) largest customers have been told prices of servers containing its AI chips will rise by more than 15% in many cases with memory chip costs soaring, Bloomberg News reported on Saturday.
The price hikes will go into effect on systems shipped early next year and will impact systems including those with the flagship Vera Rubin and Grace Blackwell chips, the report added, citing people familiar with the process. The increases will depend on Nvidia's chip generation and memory configurations, they said.
Reuters couldn't immediately verify the report. Nvidia did not immediately respond to a request for comments outside regular business hours.
Companies that build servers under contract for large data center operators such as Microsoft (MSFT.O), Alphabet Inc.’s Google (GOOGL.O) and Oracle (ORCL.N) have recently informed their customers of the upcoming increases, the report added.
Nvidia, whose chips underpin much of the AI infrastructure buildout, is set to report second-quarter results on August 26.
The company has become a proxy for the broader AI ecosystem spanning chip makers and companies financing the rapid expansion of data center capacity.
NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) trades at $215.17 as of Friday afternoon. After running the numbers, the stock looks reasonably priced relative to its growth.
Our 24/7 Wall St. price target for NVIDIA is $270.26, implying 25.27% upside over the next 12 months. Our recommendation is buy at a 90% confidence level, which qualifies as high conviction.
24/7 Wall St. Price Target Summary Metric Value Current Price $215.17 24/7 Wall St. Price Target $270.26 Upside 25.27% Recommendation BUY Confidence 90% Why the AI King Actually Looks Reasonable Here NVIDIA is down 3.75% over the past week but up 16.41% year to date and 23.79% over the past year.
The Q1 FY27 report on May 20, 2026 reset expectations: revenue of $82 billion rose 85% year over year, data center hit $75 billion, and non-GAAP EPS came in at $1.87 versus $1.77 expected.
Q2 FY27 guidance was set at $91 billion plus or minus 2%, with China data center compute excluded. Recent reports of NVIDIA committing up to $105 billion to an OpenAI data center have kept the growth narrative front and center.
Why Bulls See a Breakout Ahead The bull case rests on a demand curve Jensen Huang described as parabolic. Management said AI infrastructure spending is “on track to reach 3 to 4 trillion annually by the end of this decade” and expressed confidence in $1 trillion in Blackwell and Rubin revenue from 2025 through 2027.
AWS plans to add over 1 million Blackwell and Rubin GPUs starting this year, and Vera Rubin claims up to 35x higher inference throughput. Analyst consensus target sits at $302.83 with 48 Buy and 10 Strong Buy ratings. Our bull-case scenario points to $312.35, roughly 44.78% upside.
Risks Worth Watching The bear case starts with concentration and geopolitics. NVIDIA carries $119 billion in supply commitments and depends heavily on TSMC. China data center compute is excluded from guidance entirely.
Bears point to that beta of 2.22 and note that a hyperscaler capex pause would ripple through instantly. The counterargument: gross margin expanded to 75%, free cash flow hit $49 billion in one quarter, and the balance sheet carries D/E of just 0.073. Our bear-case scenario still lands at $233.42, an 8.2% gain from here.
How NVIDIA Compares to AMD and Broadcom Advanced Micro Devices (NASDAQ:AMD) is the closest pure-play GPU competitor, but its MI-series accelerators lack NVIDIA’s software moat, and its growth rate trails NVIDIA’s 85.2% revenue growth by a wide margin.
Broadcom (NASDAQ:AVGO) is the more direct valuation peer given its custom AI ASIC business with hyperscalers, and it typically trades at a richer forward multiple than NVIDIA’s 25x. When the leading platform trades at a lower forward earnings multiple than a supplier of custom silicon, the peer group makes our $270.26 target look conservative.
Bottom Line on NVIDIA’s Setup The 24/7 Wall St. price target of $270.26 and buy recommendation at 90% confidence rest on one fact: NVIDIA trades at a forward PEG of 0.605 while growing revenue 85.2%.
The setup looks attractive for investors who can tolerate the 2.22 beta, while those expecting hyperscaler capex to roll over before Vera Rubin ramps in the second half may want to wait for confirmation. The same buildout powering NVIDIA also lifts a wider group of suppliers we broke down in a free report on seven AI stocks that aren’t chipmakers.
Year 24/7 Wall St. Price Target 2026 $233.35 2027 $270.26 2028 $310.64 2029 $366.60 2030 $390.76 These projections assume NVIDIA executes on Blackwell and Vera Rubin ramps. Meaningful upside or downside could come from China policy shifts or a change in hyperscaler capex plans.
Contact [email protected] for any questions or corrections.
Nvidia Corporation is undervalued ahead of Q2 FY27 earnings, with market anxiety overblown and consensus estimates overly conservative. The exclusive SpaceX partnership, targeting a 10 GW data center buildout, could drive $120–230B in incremental Nvidia revenue, unpriced in current forecasts. Nvidia trades at ~24x FY27 earnings with a PEG ratio of 0.5, offering attractive entry points relative to its hypergrowth profile.
Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
The AI buildout has become a full capital cycle. Hyperscaler capex is running at record levels, enterprises are wiring generative models into core workflows, and the winners of the next decade are already visible in the revenue numbers. This month’s buy list focuses on the three US-listed names with the most durable positions in that cycle: the cloud platform monetizing AI at software margins, the search giant whose cloud arm is suddenly the fastest-growing hyperscaler, and the silicon vendor sitting at the center of the entire stack. Each pick pairs a data-verified bull case with the risk that could break it.
Framing note: treat the one-year and five-year price scenarios below as model-generated ranges rather than firm targets.
Microsoft: Azure at $100B and Copilot Compounding Microsoft (NASDAQ:MSFT | MSFT Price Prediction) trades at $483.24 with a market cap of $3.57 trillion and a forward P/E of 24. Fiscal Q4 revenue landed at $90 billion, up 18%, with Intelligent Cloud contributing $39.31 billion and Azure growing 41% to cross $100 billion in annual revenue for the first time.
The durability argument is in the backlog and the seat count. Commercial remaining performance obligation reached $678 billion, up 84%. Microsoft 365 Copilot surpassed 30 million paid seats, with net paid seat additions more than doubling quarter over quarter. GitHub Copilot revenue accelerated over 60% quarter over quarter after the shift to usage-based billing. CEO Satya Nadella framed the platform as model-agnostic: "You should and you can use frontier models. There’s no reason not to. but you also can use multiple of them."
Analyst consensus is 95 bullish, 0 bearish with a target of $569.56. The fuse-api base one-year scenario points to $590.90, with a bear case of $507.74.
The risk: fiscal 2026 capex hit $35.8 billion in Q4 alone and free cash flow fell to $19.6 billion. If AI demand normalizes before the infrastructure depreciates, margin compression becomes the story.
Alphabet: Google Cloud Is Now the Fastest-Growing Hyperscaler Alphabet (NASDAQ:GOOGL) trades at $344.82, up 73.12% over the past year. The forward P/E sits at 17, meaningfully cheaper than the other two names. Q2 revenue reached $119.80 billion, growing 24.2% year over year, with Google Cloud accelerating to $24.77 billion at 82% growth. That is the fastest growth rate of any major cloud platform this cycle.
Distribution is the moat. CEO Sundar Pichai noted Gemini processes 22 billion API tokens per minute, the Gemini App has 950 million monthly active users, and nearly 90% of the Fortune 100 use Gemini Enterprise. Operating income climbed 30% to $40.77 billion, with operating margin holding at 34%.
Analyst consensus is 91 bullish, 0 bearish, target $428.07. The base one-year scenario is $439.86, with a five-year base of $699.41.
The risk: Q2 capex hit $44.92 billion, free cash flow turned negative at -$5.86 billion, long-term debt jumped from $46.5 billion to $98.2 billion, and the buyback was suspended. Regulatory overhang on Search remains unresolved.
NVIDIA: The Platform of the Agentic Era NVIDIA (NASDAQ:NVDA) trades at $214.72, up 935.04% over five years. Forward P/E is 25. Q1 fiscal 2027 revenue reached $82 billion, up 85% year over year, Data Center hit $75 billion, up 92%, and Data Center networking nearly tripled year over year to $15 billion.
The decade-scale case is architectural. Jensen Huang told investors "Demand has gone parabolic" and that GB300 delivered a 2.7x increase in throughput and a 60% reduction in the cost per token versus six months earlier. Management reiterated confidence in $1 trillion in Blackwell and Rubin revenue from 2025 through calendar 2027. Q2 FY27 guidance is $91 billion plus or minus 2%, and that figure excludes any China Data Center compute revenue.
Analyst consensus is 95 bullish, 2 bearish, target $304.12. Base one-year scenario is $269.52, five-year base $418.65.
The risk: beta of 2.22 means drawdowns are violent, hyperscaler concentration runs near 50% of data center revenue, and China exposure is currently zeroed out. Any customer capex reset would land here first.
Setup for the Next Decade The through-line across these three: contracted backlog at Microsoft, cloud acceleration at Alphabet, and unit-economics leadership at NVIDIA. If agentic AI scales the way management teams describe, the compute, cloud, and productivity layers all compound together. If it stalls, the capex bill lands first, and the power, cooling, and networking suppliers feeding the buildout are worth a look too (we profiled seven of them in a free report on the AI infrastructure names that aren’t chipmakers).
Contact [email protected] for any questions or corrections.
When it comes to artificial intelligence (AI) semiconductor stocks, Nvidia (NVDA -0.98%) is the gold standard, and there is still a lot to like about the stock. It remains the dominant chip company for AI model training, and that is unlikely to change. Most early foundational AI code was written using its CUDA software platform and optimized for its graphics processing units (GPUs), creating a wide moat in this arena.
Meanwhile, Nvidia hasn't rested on its laurels. The company is a huge player in data center networking, which has formed the base for it to become a complete AI infrastructure player offering end-to-end rack-scale solutions designed for specific AI tasks. The company also created its own custom Arm-based central processing units (CPUs), which will serve it well as the rise of agentic AI drives servers focused on AI agents to contain more CPUs.
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Nvidia has also positioned itself well for the inference market through its "acquisition" of Groq and its language processing units (LPUs). LPUs contain a small amount of SRAM (static random-access memory) and are strung together to help reduce latency and speed up inference speeds. For systems designed for inference, Nvidia will combine its GPUs, which will handle the compute-heavy pre-fill phase of processing a prompt, with LPUs, which will provide low latency for the decode phase of generating a response.
Nvidia continues to produce incredible growth, with its fiscal first-quarter revenue soaring 85% to $81.6 billion while its adjusted EPS surged 140% to $1.87. Despite that, the stock is attractively valued, trading at a forward P/E of about 24.5 times fiscal 2027 (ending January 2027) analyst estimates. Given that, I think the stock still looks like a buy. However, given its size and the law of large numbers, I predict another AI semiconductor stock, Advanced Micro Devices (AMD +0.81%) can outperform it over the next three years.
Image source: The Motley Fool
AMD: Ready to take on Nvidia in inference While Nvidia controls the market for large language model (LLM) training, AMD is set to be a serious competitor when it comes to inference. Importantly, this is the faster-growing market and also expected to become the much larger one. According to projections from Bloomberg Intelligence, the inference market is projected to grow at a 32% compound annual growth rate through 2032 and become nearly double the size of the AI model training market, hitting annual spending of $1.3 billion.
Inference is less technically demanding than AI model training, and AMD has done a great job improving its ROCm software stack over the past few years. Meanwhile, inference is generally more memory-bound than compute-constrained, and the company's chiplet design, which can be packaged with more memory and is designed to act as part of an entire system, reduces latency.
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AMD also made two acquisitions in the space to better position it for the inference market. First, it acquired memory optimization company MEXT, which offloads less-frequently used data from DRAM to underused flash memory and then uses predictive AI to transfer it back before it's needed. It then bought inference chip start-up Taalas, which hardwires AI models directly onto its chips to bolster inference performance. It uses specific AI models, so it isn't as flexible, but it's a cheap and fast inference alternative.
Along the same lines, AMD also partnered with Cerebras to offer a disaggregated system for inference. AMD's Helios system will deal with the pre-fill phase of inference, while Cerebras' ultrafast but expensive solution will handle the decode phase. It is a partnership that should benefit both companies.
At the same time, AMD also has a huge opportunity with agentic AI. The company is a leader in server CPUs, and has been steadily taking share in this market away from Intel. With the ratio of GPUs to CPUs moving from 8:1 for training to 1:1 for agentic AI, AMD sees this becoming a $220 billion market in the next few years.
As a much smaller company than Nvidia, AMD really has the opportunity to see explosive growth and for its stock to outperform over the next three years as it makes serious inroads in the inference and agentic AI markets. With big deals already in place and its revenue growth about to take off, I think the stock can outperform Nvidia over the next three years.
Affiance Financial LLC trimmed its position in shares of NVIDIA Corporation (NASDAQ:NVDA – Free Report) by 35.9% in the 2nd quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission. The institutional investor owned 9,386 shares of the computer hardware maker’s stock after selling 5,262 shares during the period. Affiance Financial LLC’s holdings in NVIDIA were worth $1,878,000 as of its most recent filing with the Securities and Exchange Commission.
A number of other institutional investors have also recently bought and sold shares of NVDA. Norges Bank acquired a new position in NVIDIA during the fourth quarter worth $62,244,133,000. J. Stern & Co. LLP raised its holdings in NVIDIA by 13,709.1% during the fourth quarter. J. Stern & Co. LLP now owns 125,760,307 shares of the computer hardware maker’s stock valued at $23,454,297,000 after buying an additional 124,849,603 shares in the last quarter. Cardano Risk Management B.V. lifted its holdings in shares of NVIDIA by 896.4% during the fourth quarter. Cardano Risk Management B.V. now owns 78,123,960 shares of the computer hardware maker’s stock worth $14,570,119,000 after buying an additional 70,283,539 shares during the last quarter. Capital Research Global Investors boosted its position in shares of NVIDIA by 16.1% in the third quarter. Capital Research Global Investors now owns 165,377,852 shares of the computer hardware maker’s stock valued at $30,855,564,000 after acquiring an additional 22,896,705 shares during the period. Finally, Laurel Wealth Advisors LLC boosted its position in shares of NVIDIA by 15,496.1% in the second quarter. Laurel Wealth Advisors LLC now owns 21,865,525 shares of the computer hardware maker’s stock valued at $3,454,534,000 after acquiring an additional 21,725,326 shares during the period. Institutional investors and hedge funds own 65.27% of the company’s stock.
Insiders Place Their Bets In other NVIDIA news, Director John Dabiri sold 625 shares of the firm’s stock in a transaction on Wednesday, May 27th. The stock was sold at an average price of $214.00, for a total value of $133,750.00. Following the sale, the director owned 14,163 shares of the company’s stock, valued at approximately $3,030,882. This trade represents a 4.23% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Stephen C. Neal sold 15,500 shares of the firm’s stock in a transaction on Wednesday, June 3rd. The shares were sold at an average price of $215.73, for a total value of $3,343,815.00. Following the completion of the sale, the director directly owned 116,135 shares in the company, valued at approximately $25,053,803.55. This represents a 11.77% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 1,901,125 shares of company stock worth $410,583,015 over the last three months. Insiders own 3.94% of the company’s stock.
NVIDIA Price Performance NASDAQ:NVDA opened at $214.75 on Friday. The firm has a market capitalization of $5.20 trillion, a price-to-earnings ratio of 32.89, a P/E/G ratio of 0.43 and a beta of 2.23. The stock’s 50 day moving average price is $207.47 and its two-hundred day moving average price is $199.52. NVIDIA Corporation has a 12-month low of $164.07 and a 12-month high of $236.54. The company has a quick ratio of 2.85, a current ratio of 3.44 and a debt-to-equity ratio of 0.04. NVIDIA (NASDAQ:NVDA – Get Free Report) last posted its quarterly earnings data on Wednesday, May 20th. The computer hardware maker reported $1.87 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.76 by $0.11. The firm had revenue of $81.61 billion during the quarter, compared to the consensus estimate of $78.42 billion. NVIDIA had a net margin of 62.97% and a return on equity of 96.94%. The business’s revenue for the quarter was up 85.2% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $0.81 EPS. On average, analysts anticipate that NVIDIA Corporation will post 8.61 earnings per share for the current year.
NVIDIA announced that its Board of Directors has approved a share buyback plan on Wednesday, May 20th that permits the company to buyback $80.00 billion in outstanding shares. This buyback authorization permits the computer hardware maker to buy up to 1.5% of its shares through open market purchases. Shares buyback plans are typically a sign that the company’s management believes its stock is undervalued.
Key Stories Impacting NVIDIA Here are the key news stories impacting NVIDIA this week:
Positive Sentiment: NVIDIA is reportedly in advanced talks to invest several hundred million dollars in Cloverleaf Infrastructure, a developer of U.S. data-center power and infrastructure. The move could help address the electricity bottleneck limiting AI capacity while strengthening NVIDIA’s role in projects that use its systems. Nvidia in Talks to Invest in Data-Center Power Developer Cloverleaf Infrastructure Positive Sentiment: Analyst support remains strong before earnings. BMO named NVIDIA its top semiconductor pick with a $340 price target, while Jefferies reportedly expects revenue to exceed consensus by roughly $3 billion. Consensus forecasts call for approximately $91 billion of quarterly revenue, supported by Blackwell and broader AI infrastructure demand. Nvidia stock dubbed top pick ahead of Q2 earnings Positive Sentiment: Reports that SpaceX is standardizing its AI infrastructure on NVIDIA chips reinforce the company’s competitive position and could support demand for its next-generation Vera Rubin platform. NVIDIA is also exploring a potential partnership or acquisition involving South Korean AI-chip designer Rebellions, indicating continued investment in its AI ecosystem. NVIDIA Could Snap up Korean AI Chip Startup Rebellions Neutral Sentiment: NVIDIA’s proposed investment in Cloverleaf follows other efforts to finance AI infrastructure and convert future GPU capacity into a financeable asset. The strategy could accelerate deployments, but it also exposes NVIDIA to capital-allocation and customer-financing risks. Nvidia Makes Another Bet on the AI Power Bottleneck Negative Sentiment: Investors are weighing possible competitive and product risks. NVIDIA is reportedly testing Rubin Ultra configurations with less high-bandwidth memory than originally planned, while Microsoft is preparing its own Maia 300 AI chip. These developments could raise questions about performance, supply availability and long-term customer diversification. NVIDIA and AMD: Rubin Ultra memory reports Negative Sentiment: NVIDIA denied a report that it plans small-batch shipments of a China-specific AI chip by year-end, removing a potential near-term catalyst. Analysts also say any renewed China H200 sales may have only a limited effect on revenue. Nvidia to ship AI chip for China by year-end Negative Sentiment: Higher Treasury yields and warnings from investors such as Michael Burry that AI data-center financing may be excessive are adding valuation pressure ahead of a high-expectation earnings event. Analysts Set New Price Targets Several research firms have recently weighed in on NVDA. Stifel Nicolaus set a $282.00 target price on shares of NVIDIA and gave the stock a “buy” rating in a report on Thursday, May 21st. Wall Street Zen cut shares of NVIDIA from a “strong-buy” rating to a “buy” rating in a research note on Saturday, July 4th. Mizuho set a $300.00 price objective on NVIDIA in a research note on Thursday, May 21st. Benchmark restated a “buy” rating on shares of NVIDIA in a report on Friday. Finally, BNP Paribas Exane upped their price target on NVIDIA from $270.00 to $285.00 and gave the company an “outperform” rating in a research note on Thursday, May 21st. Three investment analysts have rated the stock with a Strong Buy rating, forty-nine have given a Buy rating and two have given a Hold rating to the company. According to MarketBeat, the company presently has an average rating of “Buy” and an average target price of $308.01.
Read Our Latest Report on NVIDIA
About NVIDIA (Free Report)
NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.
The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.
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Put $10,000 into the Vanguard S&P 500 ETF (VOO +0.39%) and you own a slice of 520 stocks. But the slices are nothing like even. About $750 of that money lands in Nvidia (NVDA -0.98%) and about $658 in Apple (AAPL -0.63%) -- and to me, the ordering of those two names says a lot about what an S&P 500 fund has become.
As of June 30, Nvidia was the fund's largest holding at 7.50% of assets, ahead of Apple at 6.58%, a gap approaching a full percentage point of the entire index. For years, Apple sat on top. Here's where the weights stand, how fast the switch happened, and what it means for anyone who owns an index fund and considers the matter settled.
Image source: Getty Images.
One company is 7.5% of the fundThe Vanguard S&P 500 ETF holds $1.05 trillion across those 520 positions, and the top of its list is an artificial intelligence (AI) supply chain in miniature. After Nvidia and Apple come Microsoft at 4.29%, Amazon at 3.61%, and Alphabet at 3.24% for its Class A shares alone. (Alphabet lists two share classes, so the company appears twice in the fund's holdings table.)
Those five positions total 25.22% of the fund. And the concentration runs slightly deeper than the list suggests: Count both of Alphabet's share classes, and the top five companies hold nearly 28% of every dollar invested.
The pattern runs down the list, too. Broadcom, another chip designer, sits sixth at 2.77%. And memory maker Micron, at 2.01% of the fund, had climbed into the fund's top 10 by the end of June, on the same AI demand lifting the names above it.
The switch is barely two years oldNvidia first edged past Apple's market value on June 5, 2024, at about $3.02 trillion versus $2.99 trillion -- a $30 billion gap that made it the second-most valuable U.S. company at the time, behind Microsoft. Within two weeks, it had passed Microsoft as well, taking the top spot outright.
The lead has changed hands more than once since (Apple briefly retook the top spot in July). But Nvidia is now worth about $5.3 trillion to Apple's $4.5 trillion, a difference of about $800 billion.
No fund manager decided any of this. An S&P 500 (^GSPC +0.43%) index fund weights companies by float-adjusted market value, not by results. Nvidia grew its revenue 85% year over year in its most recent fiscal quarter, to $81.6 billion, the market repriced it, and the index simply let the position swell. Apple didn't shrink. Nvidia outgrew it.
520 stocks, with 64% outside the top 10The fund's 10 biggest positions account for 36.33% of assets. Put another way, of that $10,000 investment, about $3,633 goes into those 10 positions and $6,367 gets spread across the other 510 -- an average of about 0.12% each, or about $12 per position.
That's the arithmetic behind a point many index investors haven't fully absorbed. Owning "the whole market" today means making a sizable bet on a handful of AI-linked giants, with hundreds of small positions attached. And when Nvidia reports earnings after the market closes on Wednesday, Aug. 26, the fund's next trading day could come down to one company's results.
A concentrated index fundThis isn't a flaw in the fund. After all, concentration is what a market-value-weighted index does when a few businesses grow much faster than the rest, and it has served index investors well before. Apple's long run at the top came with enormous gains for anyone who simply held on.
The design also self-corrects. A market-value-weighted fund can concentrate on the way up and thin back out on the way down without a single trade. If AI leadership fades (and someday it may), the index demotes today's giants one trading day at a time, no decision required, all for a 0.03% expense ratio.
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The flip side is arithmetic, too. A 20% Nvidia decline, all else equal, would clip about 1.5% off the whole fund by itself.
Still, the diversification an index fund's label promises is thinner at the top than it used to be. A quarter of the money rides on five companies. And more of it rides on Nvidia than on any other stock.
I think an S&P 500 fund remains the simplest way to own the U.S. market. It's just worth knowing what the weights say now. In meaningful part, this is a bet on the AI build-out.
Nvidia (NASDAQ: NVDA) shareholders holding 100 shares of the firm are expected to receive $25 when the company’s next quarterly dividend is paid.
The payment follows Nvidia’s historic dividend increase announced in May 2026, when the semiconductor giant raised its quarterly payout from $0.01 to $0.25 per share, representing a 2,400% increase.
The upcoming distribution scheduled for October 2, 2026 is expected to match the previous payment made on June 26, 2026.
At the current quarterly rate, investors holding 100 NVDA shares will earn $100 annually if Nvidia maintains its dividend policy over the next four quarters. Notably, Nvidia offers a dividend yield of approximately 0.46% and an annualized dividend of $1 per share.
Nvidia dividend payment schedule. Source: Dividend.com The company maintains a quarterly payment schedule and currently has a forward payout ratio of 7.83%, highlighting ample room to continue investing in growth initiatives while returning capital to shareholders.
Investors are now focused on Nvidia’s fiscal second-quarter 2027 earnings report, scheduled for August 26, 2026.
The technology company has guided for revenue of approximately $91 billion, while analysts expect revenue between $91.9 billion and $92.2 billion and adjusted earnings per share of roughly $2.08 to $2.09.
Wall Street bullish on Nvidia stock Wall Street remains overwhelmingly bullish on NVDA stock, with many analysts citing strong AI demand, expanding data center deployments, and Nvidia’s Blackwell and Vera Rubin platforms as key growth drivers.
In this vein, Bank of America has projected revenue between $94 billion and $95 billion, above the broader consensus estimate of approximately $91.9 billion.
Investors will also be watching Nvidia’s forward guidance closely. To this end, consensus forecasts currently call for more than $103 billion in revenue for the following quarter, with expectations that AI-related capital spending by hyperscalers such as Microsoft, Amazon, Alphabet, and Meta will remain a major growth driver.
Meanwhile, the options market is signaling heightened expectations ahead of earnings, with traders pricing in a potential post-results move of roughly 6% in either direction.
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Investors of Advanced Micro Devices (AMD +0.81%) have a big event coming up, and it really has nothing to do with AMD at all. Nvidia (NVDA -0.98%) reports Q2 earnings on Aug. 26, and what it says could have major implications on the market's view of AMD. In 2026, AMD dramatically outperformed Nvidia, rising about 120% versus Nvidia's 16%. That's a pretty stark outperformance, driven by the market's belief that AMD can take market share from Nvidia.
Depending on how strong Nvidia's results are, the investment community could shift its preference from AMD to Nvidia following earnings, and all it will take is Nvidia doing exactly what's expected of it.
Image source: The Motley Fool.
AMD's data center division growth rate recently surpassed the last numbers we have from Nvidia Comparing AMD and Nvidia is natural. They compete in many industries, including the all-important data center infrastructure sector. AI data centers are a large use case for computing equipment, and these two must establish a strong foothold and maintain it throughout the build-out. So far, Nvidia has been dominating this battle, but AMD's Q2 results may have flipped that analysis on its head.
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The last time we heard from Nvidia was its Q1 FY 2027 results (ending April 26). AMD reports on a traditional calendar year schedule, so Nvidia's Q1 encompassed about one month of the same time frame as AMD's Q2. During Nvidia's Q1, its data center division grew at 92%, which is pretty impressive. However, during AMD's Q2, it surpassed that growth rate, growing at 107%. Nvidia's data center revenue was $75.2 billion versus AMD's $6.7 billion, but that doesn't matter as much, as investors care more about AMD's potential to gain market share.
Overall, Nvidia still holds the faster growth rate, with overall revenue rising at an 85% clip versus AMD's 50% rise. What AMD investors will be looking for in Nvidia's Q2 report is whether Nvidia's data center division can grow at a faster clip than AMD's. If it can, then AMD's recent gains over Nvidia may be for nothing. If AMD takes the crown, it will justify its recent outperformance and secure its place as a rising star in the AI world.
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We'll see what happens on Aug. 26, but if I had to guess, I'd say Nvidia's data center growth rate will far outpace AMD's Q2, leading to a revival in its stock. That could cause some selling pressure on AMD's stock, as the funds to buy Nvidia have to come from somewhere, and with AMD's impressive performance so far this year, it could come from selling it.
Nvidia is doing everything it can to keep fueling the AI buildout that has underpinned its own good fortunes. On Friday, it announced a partnership with Cloverleaf Infrastructure, a company that lays the groundwork for data centers.
Cloverleaf was founded in 2024 and raised $300 million that year. It acts as a kind of middleman between utility companies and data centers, providing power sources and other kinds of pivotal infrastructure for site development.
While the companies didn’t disclose terms, the Wall Street Journal reports that Nvidia’s investment in Cloverleaf will likely add up to several hundred million dollars. Reuters reports that the chipmaker now owns a minority stake in the company. TechCrunch reached out to Nvidia for more information.
The deal is part of Nvidia’s ongoing push to use its immense profits to keep the AI flywheel spinning. Nvidia is increasingly playing a more direct role in financing and developing the AI data centers that turn around and buy its AI systems. Earlier this week, the company also announced that it would invest $1.5 billion into SB Energy, an OpenAI-linked data center project based in Ohio.
Nvidia's data center revenue suggests that it is the most dominant player in the semiconductor market. The company has been clocking outstanding growth despite its high revenue base, a trend that analysts believe will continue.
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On August 20,Microsoft’s startups blog published “Resolution, not deflection: how Maven uses AI agents to transform the enterprise customer journey”, another marquee enterprise AI customer story from the world’s largest seller of AI capacity. Hours later, billionaire investor Chamath Palihapitiya posted that for the Global 2000, “Their earnings growth has literally zero to do with AI or anything remotely close”. That same morning he asked, “Yet, high value tasks don’t seem to be increasing…so where are all these tokens going??”
The split screen matters because Microsoft (NASDAQ:MSFT | MSFT Price Prediction) is the cleanest scoreboard for whether enterprise AI is monetizing. The scoreboard is mixed. Shares closed at $481.15 on August 20, up just 0.12% year to date, down 3.91% over one year, but up 21.2% in the last month after a record fiscal year.
Six Days Until NVIDIA Sets the Tone NVIDIA (NASDAQ:NVDA) reports fiscal Q3 after the close on August 26, 2026, and Palihapitiya’s timing is pointed. Two days before his skepticism blast, on August 18, he posted the All-In Summit 2026 speaker lineup tagged to Jensen Huang, CEO of NVIDIA. He also called political blowback against AI data centers in Texas, Pennsylvania and Ohio “a powder keg” capable of unwinding 200 to 300 basis points of annual GDP, adding that “The collective leadership of frontier AI has failed miserably in doing the basics”.
Microsoft’s Counter-Evidence Is Numeric Microsoft’s Q4 FY26 earnings report, filed July 29, 2026, is the strongest rebuttal. Revenue reached $90.01 billion, up 17.75%. Azure surpassed $100 billion, up 41% for the full year. Commercial remaining performance obligations hit $678 billion, up 84%. Microsoft 365 Copilot passed 30 million paid seats, and by Q3 the AI business was already at a $37 billion annual run rate, up 123%.
CEO Satya Nadella framed the monetization story directly:
“We are advancing the frontier on the cost-to-outcome curve, ensuring every customer can turn tokens into business results.”
CFO Amy Hood was blunter on returns: “All of these things contribute, obviously, to your point of increased confidence in ROIC, frankly, of the dollars that we’re investing.” She also said “demand continues to exceed available supply.”
Where the Skeptic Has a Point The cost side is real. Q4 capex was $35.8 billion, up 109.63%, and full-year capex hit $115.95 billion, up 79.62%. Free cash flow fell to $19.64 billion, down 23.19%. EPS of $4.74 was aided by a $3.2 billion Anthropic gain. With the stock essentially flat YTD, the market is still adjudicating whether tokens become durable earnings.
NVIDIA’s August 26 print will reset that debate. If Huang guides in line with Microsoft’s contracted backlog, Palihapitiya’s “literally zero” framing gets tested against $678 billion of signed commitments. If not, the skeptics own the narrative, and the buildout question shifts to the companies powering and cooling the racks (we profiled seven of those suppliers in a free AI infrastructure report).
Contact [email protected] for any questions or corrections.
Nvidia Corp. (NVDA, Financials), the dominant supplier of AI processors, is putting money into another part of the artificial intelligence boom: the infrastructure needed to power it.
That helps explain why Nvidia has put money into Cloverleaf Infrastructure, a startup that is focused on building power projects for massive data centers. This is a good step because Nvidia is no longer only selling more GPUs as its growth story.
Those chips need large quantities of electricity and the businesses developing the AI data centers are already bumping into restrictions regarding grid access, power availability and how rapidly more capacity can be added. Nvidia obviously sees that problem getting bigger.
Backing Cloverleaf gives the company a means to get closer to the infrastructure side of the AI buildout and potentially help take one of the constraints off its clients. It also tells you something about where the AI boom is headed. The chips were the shortage everyone feared in the last few years. The next scarcity it may be megawatts.
That's important for Nvidia because customers can't put their systems to use, even if demand is great, if they don't have enough power to run them. So this might not be a big issue for Nvidia financially, but it fits into a much wider story. The corporation is beginning to spend not just in the AI boom itself, but in the things that need to happen to keep the boom going.
NVIDIA Corp. (NASDAQ:NVDA) reports fiscal second-quarter results next Wednesday after the market close, and the print arrives as the chipmaker’s remarkable AI-driven rally faces a stagnant stretch.
NVDA stock is trending. See the chart and price action here. Nvidia shares have surged from roughly $11 in late 2022, split-adjusted, to about $216 today, a gain near 1,700% since ChatGPT’s November 2022 launch kicked off the AI boom, according to Bespoke Investment Group.
The move ranks among the most powerful multi-year runs by any large-cap stock in recent market history, and the long-term chart remains firmly in an uptrend despite a sluggish past year.
Bespoke highlights just how dramatic the shift in fundamentals has been. Quarterly revenue has exploded since late 2022, blowing past Wall Street’s consensus estimates by wide margins nearly every period. Few companies have seen fundamentals catch up to a stock’s rally quite like this one.
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The Triple-Play KingNvidia has become what Bespoke calls a “triple-play king,” a company that consistently beats both earnings and revenue estimates while also raising guidance.
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Over the past 20 quarterly reports spanning five years, the chipmaker has delivered 14 triple plays, including three straight heading into Wednesday’s release.
The catch: Nvidia’s triple plays no longer guarantee a stock pop. Shares finished lower on each of the last three beat-and-raise reports, suggesting investors have priced in near-flawless execution and now demand something more.
Sky-High ExpectationsExpectations have grown too large for good news alone to move the needle. A beat-and-raise quarter, once cause for celebration, now reads as the baseline.
Nvidia investors increasingly want confirmation that AI demand extends well beyond the current cycle, plus clarity on margins as competition intensifies from custom silicon and rival chipmakers.
Wednesday’s report will test whether Nvidia can finally snap the pattern. A fourth consecutive triple play met with another sell-off would reinforce the idea that the stock has entered a “prove it” phase, one where even flawless numbers cannot overcome heightened investor demands.
NVDA Stock Price Activity: Nvidia stock was down 0.47% at $215.89 at the time of publication on Friday, according to data from Benzinga Pro.
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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Buy Nvidia (NVDA). The article says systems are “fully booked for the next 12 months” and the Vera Rubin NVL72 ramps in the back half, so earnings should confirm demand/supply tightness rather than hype. Valuation is framed as a “discount” at ~18x forward P/E versus very high growth (84% revenue growth in fiscal 2027).
Key Risk: Customers suddenly slow AI capex or cancel/defers orders, breaking the “fully booked” visibility.
AI infrastructure beneficiaries
Buy Broadcom (AVGO). If NVDA demand stays strong, hyperscalers keep building AI clusters, which pulls through networking/ASIC spend. AVGO is a direct second-order beneficiary of more AI rack deployments and higher switch/accelerator demand tied to NVDA-led buildouts.
Key Risk: AI infrastructure spending shifts away from networking/ASICs or AVGO’s AI-related revenue growth disappoints despite NVDA strength.
Nvidia NVDA stock is in focus on Friday after BMO Capital Markets said the chipmaker remains a “top pick” for those seeking exposure to the global artificial intelligence (AI) buildouts.
Analyst Harsh Kumar announced an Outperform rating and $340 price target on the semiconductor behemoth heading into its fiscal Q2 earnings set to be released on August 26th (after market close).
Ahead of the earnings event, Nvidia stock is up over 30% versus its year-to-date low.
BMO’s bullish thesis starts with Nvidia’s unusually strong position across the AI computing stack.
Kumar said the giant’s AI systems are “fully booked for the next 12 months as demand exceeds supply,” a striking assessment heading into its earnings report.
That level of visibility matters because it suggests NVDA shares’ growth story is being supported by actual customer demand rather than simply elevated expectations around AI spending.
BMO also expects Nvidia’s next-gen Vera Rubin NVL72 system to begin ramping in the back half of the year.
The new platform could provide another leg of growth as hyperscalers and other large customers continue expanding AI infrastructure.
Kumar’s broader view is that AI remains in “the early innings,” with capital expenditures expected to rise for years as demand for AI tokens and computing capacity expands.
Crucially, BMO does not believe Nvidia’s valuation has become excessive relative to its expected growth.
Kumar pointed to the stock’s 18x forward price-to-earnings (P/E) multiple – calling that valuation “a discount” when measured against the firm’s expected revenue growth.
According to him, NVDA could grow revenue by 84% in fiscal 2027 and another 50% in the year after.
His argument goes directly against one of the biggest concerns surrounding Nvidia shares: whether the stock already prices in too much of the AI boom.
At roughly $216, Nvidia remains below its $236 high and has recently struggled to regain its May peak.
The combination of a still-elevated growth rate, massive AI infrastructure demand and a valuation BMO considers compelling gives the bull case more substance than simply betting on another AI-driven rally.
Wall Street’s expectations for Nvidia Corp’s fiscal Q2 results are already enormous.
Consensus estimates call for about $92.16 billion in revenue and $2.09 in adjusted earnings per share, representing year-over-year growth of about 96% and 99%, respectively.
The underlying strength in Nvidia’s financials reflects sustained demand for its AI chips – as cloud providers and other major tech firms continue committing enormous sums to AI infrastructure.
Note that NVDA stock also currently pays a small dividend yield of 0.46%, which makes it even more attractive as a long-term holding.
Semiconductor stocks sold off hard this week. The PHLX Semiconductor Index dropped about 5% on Tuesday and fell another 2% on Wednesday, and it now sits about 20% below the record it set on June 22.
A slide like that usually follows bad news. The unusual part is that there wasn't any -- at least not from the chip companies. The only company in the index that reported results this week, Analog Devices (ADI +1.64%), delivered records -- and told investors to expect a record fourth quarter on top of them.
Most of the pressure came from outside the sector: a bond market pushing long-term borrowing costs to two-decade highs, with rising oil prices piling on. On Tuesday, the yield on the 30-year U.S. Treasury bond topped 5.33%, its highest level since June 2007, according to CNBC.
For growth stocks whose valuations rest on profits years into the future, a yield like that is a problem all by itself.
Image source: Getty Images.
Two ugly sessionsTuesday was the heavy one. The semiconductor index fell from 12,621 to 11,992, a decline of about 5%, with the selling reaching from the memory names to the artificial intelligence (AI) chip leaders.
Advanced Micro Devices (AMD +0.41%) fell about 4% on Tuesday and nearly as much on Wednesday. Micron Technology (MU -1.02%) dropped about 7% on Tuesday. Even Nvidia (NVDA -0.82%), the sector's biggest company, lost ground both days, though it held up better than most.
Wednesday's follow-through took the index down to 11,738. The two sessions together erased about 7% of the sector's value -- and this wasn't even the year's roughest stretch, since the index fell more than 10% in a single session back in early June.
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And the run that preceded the slide is worth keeping in view. The index ended 2025 at 7,083. Even now, it is up about 66% in 2026.
The selling tracked the bond marketThe 30-year Treasury yield has been climbing on worries that have nothing to do with semiconductors. The U.S. fiscal deficit hit $432.3 billion in July, its highest monthly total since March 2021, pushing the fiscal year's shortfall to nearly $1.8 trillion. Inflation remains above the Federal Reserve's 2% target, and rising oil prices have added to the worry. In short, investors are demanding more to lend the government money for 30 years than they have at any point since 2007.
To be fair, the day-to-day fit between yields and chip prices is loose. The 30-year first pushed into 19-year-high territory on Monday, and chip stocks rose that session. Then on Wednesday, the Treasury Department said it would double the size of its debt repurchases, the 30-year yield eased back to about 5.18% -- and chip stocks fell anyway.
The daily wiggles, I'd argue, aren't really the point. The level is. As of this writing, the 30-year is back above 5.2% and climbing again. Wherever the top tick lands, long-term money now costs more than it has in almost two decades.
Why does that matter for chip stocks in particular? A stock trading at a high price-to-earnings ratio is a claim on earnings that arrive years from now. When a Treasury bond pays more than 5% with no default risk, those faraway earnings are worth less today. The stocks with the most of their value parked in the future have the most to lose.
Multiples, sortedOf course, the math doesn't hit every chip stock equally. Nvidia trades at about 33 times earnings, and about 22 times the profit analysts project for the year ahead. Those are big numbers, but they sit on revenue that grew about 71% over the past 12 months. AMD, near $465 as of this writing, costs about 42 times the year-ahead projection, with far more of its value resting on results that haven't arrived yet.
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And Micron trades at about 21 times earnings but only about 6.5 times expected earnings. Investors already doubt the memory boom's staying power, so its problem is the cycle, not the discount rate.
Sure, Tuesday's selling was indiscriminate -- every one of those stocks fell, whatever its valuation. Panicked days usually are. But if long rates stay near 2007 levels, I'd expect the sorting to continue, with the richest multiples doing the most adjusting.
Ultimately, this week's decline looks to me like a reset more than an opportunity. No chip company's reported demand turned this week, and the one earnings report the sector produced was a record. What changed is the yield on the safest long-term asset in the world. Until that comes back down, a sector that has gained about 66% this year probably shouldn't count on getting June's prices back.
Nvidia Corporation remains my top AI infrastructure pick, retaining a Strong Buy rating ahead of earnings. Consensus expects nearly 100% YoY revenue and EPS growth for Q2, with guidance and AI demand commentary as key watch items. NVDA's robust cash generation and low capex could result in over $500 billion cash by FY29, supporting enhanced shareholder returns.
Nvidia published some interesting new research on Friday suggesting it’s the harness, more than the underlying model, that is far more important when asking an AI to do long-horizon tasks.
The tldr: simply by using a custom harness tweaked to handled memory well and including a “supervisor” boss-like component, researchers got Claude Opus 5 to achieve a 100% score on the interactive reasoning benchmark ARC-AGI-3. (That’s a benchmark that has particularly irked rival frontier lab OpenAI.) Without the harness Opus 5 scored 30%, which was the top result among all the models tested.
Nvidia’s research is another indicator that, while model choice does matter, acting like the agent’s brain, it is a smaller part of an agentic system than many AI users realize, especially for long-horizon tasks. The harness is what makes a model an agent: it handles memory, context, feedback.
“Generally speaking the world interprets an agent almost as an API of the model,” Adel El Hallack, vice president of product in Nvidia’s AI unit (pictured above), tells TechCrunch. But an agent is actually more than that. “It is the model. It is the scaffolding around the model, which we call the harness, i.e. the set of tools that it utilizes. It is the runtime and the associated skills and libraries that we give it access to.”
Long-horizon tasks are those that require stringing many decisions together, sometimes over days, to produce completed work. This is in contrast to an AI just spitting out a response to a prompt. Figuring out how to get an AI to do long-horizon tasks without getting distracting and going off in la-la land is one of the holy grails in agentic research.
For example: Microsoft published research in April that tested 19 LLMs on long-horizon tasks involving document editing and discovered that all the models, including frontier ones, filled the documents with errors. (If humans produced work like that, they would be promptly fired.)
Models stringing decisions together on their own have also been caught deleting their users’ files, even whole databases or turning to criminal behavior to achieve their objectives from collusion to hacking.
The choice by Nvidia researchers to use this interactive reasoning benchmark for their tests is particularly meaningful, almost funny. This is a benchmark of a bunch of 2D games with no instructions. The model has to figure out how to play and win. A 100% score means that the model can beat the games as well as humans.
OpenAI was so flustered by its models’ abysmal scores (less than 10%) on ARC-AGI-3 that it conducted its own research last month. Like Nvidia, OpenAI discovered that simply by tweaking two setting on the harness, its models tripled their scores.
But none of the models came close to hitting a 100% score, like Nvidia’s researchers achieved. They showed that the harnesses needs a “supervisor” component that prods the agent in the right direction if it gets stuck.
“The more interesting part was introducing a supervising agent in addition to your main agent that’s doing the work,” El Hallack said. It “almost acts like a CEO to nudge the agent when it goes off direction or starts exploring a path that it might lead to a dead end, or re-ex explore a path that it had previously trod.”
While the concept of the supervising agent isn’t exactly new, today most agent users are relying on only one layer for their harness, like Claude Code, Codex, Hermes, etc. Nvidia researchers created their own souped-up harness called the Agentic Variation Operators (AVO). Note that this isn’t a new Nvidia product. Nvidia instead produces lots of open bits and pieces of tech for building harnesses under the Nemo brand. Some of that tech is commercial, much is openly available.
Still, Nvidia’s results adds to the growing evidence that model choice is far from the only factor in agentic performance. In July, for instance, Databricks published some stunning research that shows that the harness, more than model, dramatically impacts AI costs.
“You can pick the same model but different harnesses, and you get significantly more cost if you use the wrong harness,” Databricks CEO Ali Ghodsi told TechCrunch. “So you think, oh, this is an expensive model. This is a cheap model. But wait, which harness are you using? That itself can 2x your cost.”
Nvidia’s larger point does is to show that open harnesses, like open models, put users in control far more than they realize.
“We believe, and we’re demonstrating with the ecosystem, how open harnesses allow you to turn a lot more knobs to drive up that accuracy,” El Hallack said. “It relates to OpenAI slowing down the training of their models,” as a result of models creating security breaches.
“We believe in having an open agent stack — where you have control across the harness, across the infrastructure, across the runtime — is what’s required for us to usher the ecosystem forward and securely,” he added.
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Americké akciové trhy během dnešního obchodování posilují a směřují k uzavření volatilního týdne v zelených číslech.
Širší index S&P 500 si připisuje 0,44 % na 7675,03 bodu, tradiční index Dow Jones roste o 0,83 % na 53197,16 bodu a technologický Nasdaq Composite zpevňuje o 0,46 % na 26187,5 bodu. Náladu na trhu podporují solidní ekonomická data ukazující na nejrychlejší růst podnikatelské aktivity v USA za poslední čtyři roky, přičemž investoři zároveň sledují situaci kolem dluhopisových výnosů a vyhlížejí nadcházející výsledky společnosti Nvidia Corp (NVDA).
V rámci jednotlivých odvětví indexu S&P 500 se nejvíce daří sektoru základních materiálů se ziskem 2 %, který následují zdravotní péče s růstem o 1,4 % a komunikační služby se ziskem 1 %. Na opačné straně nejvíce odepisují utility s poklesem o 1,6 %, energie se ztrátou 0,3 % a reality, které klesají o 0,1 %.
Mezi nejúspěšnější akcie dne se řadí společnost Robinhood Markets (HOOD) s výrazným nárůstem o 14 %. Výrazně posilují také firmy Moderna (MRNA) o 9,5 %, Coinbase Global (COIN) o 8,4 %, Freeport-McMoRan (FCX) o 7,0 % a Albemarle Corp (ALB) se ziskem 6,3 %. Naopak nejhlubší propad zaznamenává společnost Marvell Technology (MRVL), která ztrácí 5,7 %. Nedaří se ani firmám Sempra (SRE) se ztrátou 4,3 %, Edison International (EIX) a Bunge Global SA (BG) s poklesem o 3,5 % a Quanta Services (PWR), jež oslabuje o 3,3 %.
Na komoditním trhu roste cena severoamerické lehké ropy WTI o 0,3 % na 87,06 dolaru za barel, zatímco spotové zlato posiluje o 2,5 % na 4631,27 dolaru za unci. Americký dolar vůči euru zůstává téměř beze změny na úrovni 1,1678 dolaru. Výnos desetiletých amerických vládních dluhopisů roste o tři bazické body na 4,73 %. Výrazný růst zaznamenává bitcoin, který posiluje o 6,9 % na 77676,71 dolaru.
Index Dow Jones +0,83 % na 53197,16 b.
S&P 500 +0,44 % na 7675,03 b.
Nasdaq Composite +0,46 % na 26187,5 b.
Index S&P 500 +0,44 % na 7675,03 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Základní materiály +2 % Utility -1,6 % Zdravotní péče +1,4 % Energie -0,3 % Komunikační služby +1 % Reality -0,1 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Robinhood Markets (HOOD) +14 % Marvell Technology (MRVL) -5,7 % Moderna (MRNA) +9,5 % Sempra (SRE) -4,3 % Coinbase Global (COIN) +8,4 % Edison International (EIX) -3,5 % Freeport-McMoRan (FCX) +7,0 % Bunge Global SA (BG) -3,5 % Albemarle Corp (ALB) +6,3 % Quanta Services (PWR) -3,3 %
Daniel Marván, Fio banka, a.s.
Nvidia (NVDA) earnings will move the market on Wednesday, August 26. Tune into Schwab Network before, during, and after the Mag 7 company reports to get comprehensive coverage on the biggest earnings of the quarter.
