United

Artificial Intelligence

Alphabet

Bubble

<img decoding="async" width="1301" height="761" src="https://coingape.com/wp-content/uploads/2024/02/nvidia-us-stocks-market.jpg" class="attachment-full size-full wp-post-image" alt="" style="float:right; margin:0 0 10px 10px;" srcset="https://coingape.com/wp-content/uploads/2024/02/nvidia-us-stocks-market.jpg 1301w, https://coingape.com/wp-content/uploads/2024/02/nvidia-us-stocks-market-300x175.jpg 300w, https://coingape.com/wp-content/uploads/2024/02/nvidia-us-stocks-market-1224x716.jpg 1224w, https://coingape.com/wp-content/uploads/2024/02/nvidia-us-stocks-market-768x449.jpg 768w, https://coingape.com/wp-content/uploads/2024/02/nvidia-us-stocks-market-150x88.jpg 150w" sizes="(max-width: 1301px) 100vw, 1301px">
The continuous plunge in the price of NVIDIA (NVDA) seems to indicate that the <a href="https://coingape.com/glossary/artificial-intelligence/">Artificial Intelligence</a> (AI) ecosystem is moving into a bear season with some suggesting that the “AI bubble” is bursting. 
<h2 id="strong-nvidia-business-model-disrupted-strong">NVIDIA Business Model Disrupted</h2> 
Top business Executive Bryan Beal voiced his opinion about the situation on X, stating clearly that the AI bubble is not bursting.&nbsp; 
The entrepreneur noted that for a very long time, many people did not realize that NVIDIA was not directly involved in making chips. Rather the company is responsible for the design of the semiconductors while the Taiwan Semiconductor Manufacturing Company (TSMC) Limited makes them. 
From its inception, some of NVIDIA’s key clients were Meta, Amazon, OpenAI, Microsoft, Google, etc. Recently, many of these customers have chosen to design their AI chips themselves, causing NVIDIA to lose a significant part of its market. A few days back, <a href="https://coingape.com/nvidia-feels-the-crunch-as-intel-google-forge-ahead-with-ai-chip-advancements/">Intel and Google</a> unveiled Gaudi 3 and Axion chips, competing with NVIDIA’s most recently launched AI chip <a href="https://coingape.com/nvidia-unveils-new-ai-superchip-blackwell-nvda-stock-price-to-rally/">Blackwell</a>. 
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
 The AI bubble is not bursting. 
 More investors are just realizing that Nvidia doesn’t make chips. They design them and TSMC makes them. And Nvidia’s biggest customers (Meta, Amazon, OpenAI, Microsoft, Google, etc) have ALL announced they are designing their own AI chips for both… <a href="https://t.co/RQgSipm0Ku">https://t.co/RQgSipm0Ku</a> 
 — Bryan Beal <img src="https://s.w.org/images/core/emoji/15.0.3/72x72/1f3a7.png" alt="🎧" class="wp-smiley" style="height: 1em; max-height: 1em;"> (@bryanrbeal) <a href="https://twitter.com/bryanrbeal/status/1781454698136109380?ref_src=twsrc%5Etfw">April 19, 2024</a>
</blockquote> 
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
The sudden withdrawal of the firms probably contributed to the price plunge that NVDA stock saw these last few days. While this showed a threat to NVIDIA, it marks the start of the AI market overall, implying the “AI bubble” is not bursting yet. 
<h2 id="strong-the-nvidia-bears-sets-in-strong">The NVIDIA Bears Sets In</h2> 
Like many other tech companies, NVIDIA has been experiencing a major sell-off in the last few days with its stock dropping by a significant percentage.&nbsp; 
This marks the lowest level that the stock has seen since February and its worst single day since March 2020. On Friday, its <a href="https://coingape.com/ai-giant-nvidia-surpasses-2t-market-cap-post-earning-boom/">market capitalization</a> fell below $2 trillion while its shares dipped by 7.3% to trade below $800. 
Noteworthy, NVIDIA’s market cap of $2 trillion was achieved in February 2024, barely 270 days after it surpassed $1 trillion. Since that time, the shares have continued to rise to the point of topping $950. This meteoric rise gave NVIDIA’s market cap a push to $2.4 trillion.&nbsp; 
However, the presence of strong economic data and a batch of hotter-than-expected inflation reports this month have forced markets and policymakers to lower their expectations for the interest rate cuts this year.&nbsp; 
This outlook has now caused NVIDIA and other tech stocks to waver. At the time of this writing, the AI-chip company’s stock was trading on Nasdaq at $762, with a 10% drop in the last 24 hours and by more than 14% over the trailing 5-day period. 
Even with the plunge from Friday, the AI-chip company maintained its position as the third-most valuable firm in the United States, still ahead of Alphabet (GOOGL) and Amazon (AMZN). 
The post <a href="https://coingape.com/nvidia-nvda-5-day-slump-hits-14-4-is-the-ai-bubble-bursting/">NVIDIA (NVDA) 5-Day Slump Hits 14.4%, Is The AI Bubble Bursting?</a> appeared first on <a href="https://coingape.com">CoinGape</a>.

NVIDIA (NVDA) 5-Day Slump Hits 14.4%, Is The AI Bubble Bursting?

Table of Contents

Coingape News Media

Other articles published on Apr 20, 2024

Bitcoin Stays Resilient Amid Market Corrections, Eyeing Long-Term Gains Post-Halving, Analysts Say

XRP Holder’s Attorney Represents Thousands of Coinbase Customers in SEC Battle

4 Cryptocurrencies You Might Want To Sell This Bitcoin Halving

XVC Tech Announces Strategic Investment in TradeTogether to Enhance Web3 Wealth Management

Altcoins to Brighten Your Financial Future

Can This New Multi-Chain Dog-Themed Meme Coin Be the Next 1000x Investment?

Join our free newsletter for daily crypto updates!