Is It Time To Reassess Nvidia (NVDA) After The Recent AI Rally And Pullback - simplywall.st

This article delves into the underlying factors driving NVIDIA's recent stock price fluctuations, particularly amid the surge in artificial intelligence demand that has propelled its valuation, follow... Read original →

NVIDIA’s valuation divergence reflects a pricing battle over the AI infrastructure paradigm shift. Technically, its CUDA ecosystem is tightly integrated with 3nm EUV processes, creating an end-to-end lock-in that pressures cloud providers and startups—but also spurs AMD and Intel to accelerate open alternatives like ROCm and oneAPI. On compliance, U.S. export controls on advanced AI chips boost near-term orders from fabs in Taiwan, China, yet inflate supply chain fragility and inventory risk. Strategically, Huawei’s Ascend chips are capturing China’s domestic training market, while AWS and Google erode NVIDIA’s data center dominance via custom TPUs for inference. Over the next 12–24 months, any slowdown in global AI capex or geopolitical disruption to TSMC’s 3nm output could expose NVIDIA’s high-valuation, low-margin-for-error vulnerability—likely keeping its stock volatility above sector averages.