In midday trading on Wednesday, Nvidia's stock took a hit, sliding about 3% after Google's announcement of a new chip technology that could potentially compete with Nvidia's graphic processing units (GPUs). Google's new tensor processing unit (TPU) is designed for artificial intelligence (AI) tasks and could potentially replace Nvidia's GPUs in some applications.
The news comes after a series of setbacks for Nvidia, including the recent trade tensions between the U.S. and China, which has led to Japan following the U.S. in preventing semiconductor manufacturing equipment from being sent to China. This could potentially impact Nvidia's supply chain and affect its production capabilities.
Additionally, Nvidia is facing increased competition in the gaming card market. Following a flood of new gaming cards this past holiday season into an already crowded market, one analyst believes the gaming card market may have peaked, which could impact Nvidia's sales.
Nvidia is the top designer of discrete GPUs that enhance the visual experience on computing platforms. The company has been a leader in the AI space, with its GPUs being used in a wide range of applications, including self-driving cars, healthcare, and finance.
Despite the recent setbacks, Nvidia earnings are set to rebound, and the company's AI leadership has excited investors in the chipmaker. Nvidia stock is on a tear, with shares up more than 70% over the past year. However, some analysts are questioning whether Nvidia is still a buy, given the recent challenges the company has faced.
Big tech stocks powered robust gains on Wall Street in the first quarter of 2023, with some of the market's most notable names posting their strongest quarterly gains in years. Nvidia was one of the top performers, with its stock up more than 20% in the quarter.
Meanwhile, Benchmark cut the price target for CuriosityStream Inc. (NASDAQ: CURI) from $8 to $4, but maintained a Buy rating on the stock. CuriosityStream is a streaming service focused on documentaries and other non-fiction content.
Nvidia Corp. (NASDAQ: NVDA) shares were down in premarket trading on Wednesday amid worries over the potential escalation of the standoff between the U.S. and China. The company has significant exposure to the Chinese market, with China accounting for about a quarter of its revenue.
Overall, Nvidia remains a top player in the chipmaking space, with its GPUs being used in a wide range of applications. However, the company is facing increased competition and challenges in the gaming card market and potential supply chain disruptions due to trade tensions. Investors will be closely watching how Nvidia navigates these challenges and whether it can continue to deliver strong earnings growth.