Nvidia Stock Soars Past Record After Launching Game‑Changing AI Chip

Impact of Nvidia’s New AI Chips on Its Stock Performance

Key Takeaway

Shares fell over 6% on Tuesday as technology stocks pulled back after a peak the day before when Nvidia unveiled its latest AI processors.

Factors Influencing the Downturn

• Market reaction to the previous day’s record high.
• Widespread selloff across the technology sector.
• Investor uncertainty regarding the long‑term pricing strategy for the new chips.

What This Means for Investors

Analysts are re‑evaluating Nvidia’s valuation, while many traders are adopting a cautious stance amid a broader tech‑market correction.

Tech Stocks Tumble as Nvidia’s Shares Fall 6.2%

Background

On Tuesday, Nvidia’s stock price fell by 6.2% after reaching a record high the previous day. The pullback followed the company’s announcement of new AI chips that fuel its growth prospects.

Market Context

• Widespread sell‑off across technology equities.
• Rising U.S. government bond yields contributed to the decline.

Nvidia’s Performance Snapshot

Despite the dip, Nvidia remains the top performer among the so‑called Magnificent Seven stocks.

• Year‑on‑year growth: 185% increase.
• Over the past two years, the company’s stock price has risen by more than 900%.

Financial Highlights

The chipmaker’s earnings have seen explosive growth, driven by the artificial intelligence boom:

• Revenue has nearly five‑folded in the last five quarters.
• The Data Centre division accounts for roughly 90% of total revenue and has posted record sales for eight consecutive quarters.

Blackwell-backed GeForce RTX 50 series

What NVIDIA’s New RTX 50 Series Means for Gaming and Investors

NVIDIA’s CEO, Jessen Huang, presented the latest graphics lineup— the GeForce RTX 50 series— at the 2025 Consumer Electronics Show in Las Vegas. These GPUs are powered by AMD’s Blackwell architecture, the engine that Nvidia says will drive its next wave of growth.

Performance Highlights

Unlike past releases that balanced workstation and gaming needs, the RTX 50 chips target gamers directly:

• Optimized for higher frame‑rate output in popular titles.
• Optimized power envelope for laptop and PC builds.
• Broader adoption across a range of system prices—from $550 (€531.10) to $2,000 (€1,931.30).

Economic Impact

While the gaming sector once accounted for the majority of NVIDIA’s revenue, today it represents only 9 % of the company’s total earnings. Historically, the pandemic’s stay‑at‑home surge drove this share.

Investor Perspective

For investors, the focus shift from gaming to enterprise AI and data‑center workloads means a higher risk of dilution— the company’s leverage will need to balance hardware sales with long‑term software licensing.

Future Outlook

With shipment of the Blackwell chips starting in late 2024, NVIDIA’s next revenue stream will come from its next generation AI compute units. The new RTX 50 series will play a supporting role as the core “Blackwell” platform saturates the market.

Desk-top sized supercomputer: “Project Digits”

Introducing Project Digits: NVIDIA’s Personal AI Supercomputer

In a recent corporate announcement, NVIDIA unveiled Project Digits, a desktop‑scale AI powerhouse designed to put advanced computational capability right at the fingertips of researchers, data scientists, and students worldwide. By bringing the formidable NVIDIA Grace Blackwell platform into the home office, NVIDIA aims to widen its footprint across the personal computing market.

Inside the Engine: The GB10 Grace Blackwell Superchip

The centerpiece of Project Digits is the GB10 Grace Blackwell Superchip. This compact module can execute models up to 200 billion parameters—an impressive feat typically reserved for large‑scale data centers. Yet the chip is engineered to fit into a standard desktop package, allowing developers to harness high‑performance AI without relying on bulky hardware.

Flexibility for Developers

• Runs next‑generation neural networks in a single desktop chassis
• Supports on‑the‑go research, rapid prototyping, and advanced data analysis
• Offers consistent, powerful performance no matter where the user is

Launch Timeline and Cost

Project Digits will become available in May, with a starting price of $3,000 (approximately €2,896.90). This cost positions the system as a high‑end but approachable option for professionals and academia alike.

Strategic Collaboration with MediaTek

In partnership with MediaTek, a Taiwanese semiconductor leader known for power‑efficient chips, NVIDIA leverages MediaTek’s manufacturing expertise to deliver the GB10 Superchip. This collaboration enhances the product’s efficiency while maintaining its raw power.

A Vision for AI Everywhere

“AI will be mainstream in every application for every industry,” said a NVIDIA executive. “With Project DIGITS, the Grace Blackwell Superchip comes to millions of developers. Placing an AI supercomputer on the desks of every data scientist, AI researcher, and student empowers them to engage and shape the age of AI.”

Diversification in the AI-powered technology world

Nvidia’s Revenue Boom Tied to Hyperscaler Giants

Over the last two years, Nvidia’s earnings have surged thanks largely to its customer base in the hyperscaler segment—Amazon, Microsoft, and Alphabet together contribute roughly fifty percent of the company’s total revenue.

CEO Highlights Diversity in the AI Sector

During the earnings call for its October quarter, CEO Jensen Huang emphasized that the AI market is “large and diverse.” He reiterated Nvidia’s plans to broaden its product line beyond the cloud, targeting markets such as consumer internet, automotive, and healthcare.

CES 2025: Broadening the Vision

At the recent CES event, Nvidia announced aims to enable its technology across emerging domains, including robotics, autonomous vehicles, and AI development frameworks. The firm introduced Nvidia Cosmos, a platform designed to support physical AI creation for self‑driving cars and robots.

Analyst Outlook: Sustained Growth

eToro analyst Josh Gibert believes Nvidia is on an ongoing path of strong expansion. “Huang charted a clear roadmap for what’s to come—new hardware and an overarching AI vision,” he said. “The company’s momentum doesn’t appear to be cooling, and February’s figures are expected to reinforce that trend.”