Nvidia's stock has experienced a 21 percent drop from its recent peak, raising concerns among investors. Despite key companies like Amazon, Alphabet, Meta, and Microsoft planning to jointly invest $300 billion this year, Nvidia's spending on artificial intelligence is generating uncertainty in the market.
According to estimates compiled by Bloomberg, the company is expected to report a revenue growth of 73 percent compared to the previous quarter, which was 94 percent, and significantly lower than the 265 percent growth of the same quarter last year.
The drop in stock price has made Nvidia's valuation more attractive to some investors. Although the shares are currently trading at about 30 times future earnings, compared to an average multiple of over 40 times in the last five years, buyers are not flocking to purchase.
The Chief Investment Officer of SPEAR Invest, Ivana Delevska, points out that if Nvidia does not meet expectations, the stock is likely to remain relatively stable until the second half of the year.
Additionally, concerns about Nvidia's Blackwell chips, along with manufacturing challenges and supply constraints, have weighed on investors. The company has experienced a slow rollout of its new product line, raising worries about costs and potential impacts on its growth.
The company is facing growing caution from investors amid rumors of a possible slowdown in spending on artificial intelligence. Competition, such as the Chinese AI startup DeepSeek, has heightened concerns in the financial market and led to a significant decrease in Nvidia's market value.
The prevailing negative sentiment has shifted investor predisposition ahead of Nvidia's upcoming quarterly results, scheduled for February 26. Previous reports from the company were met with optimism, driving the stock to new highs, but this time, the atmosphere is one of greater caution and skepticism.
