According to Finance Associated Press reports on September 7, as "the most important stock on Wall Street," NVIDIA's market cap has evaporated approximately $406 billion this week, putting significant pressure on the US stock market. There are signs that people's concerns about the health of the US economy and the potential for overreliance on AI trading are rapidly spreading.

Over the past two weeks, the market cap of this global leading AI chip manufacturer has shrunk by about one-fifth. For this tech giant that has almost single-handedly led the rise of the US stock market in the past two years, the recent plummet also highlights a more urgent issue facing investors - NVIDIA's volatility is making other "seven giants" pale in comparison, and even in contrast, Bitcoin seems like a calm harbor.

Market data shows that over the past 30 trading days, NVIDIA's stock price has fluctuated greatly between $90.69 and $131.26, with this Tuesday marking an unprecedented level of market cap decline (evaporating $279 billion) for a single stock in the US stock market.

This level of volatility has brought NVIDIA's actual volatility index over the past 30 days to around 80 - about four times Microsoft's, twice Bitcoin's, and higher than Trump's media company and a series of meme stocks.

According to data compiled by the industry, this decline has pushed the stock to its worst performance in two weeks over the past two years. Before the stock price decline, the company had just released lukewarm performance forecasts last month, and its Blackwell chip encountered shipping delays, dampening investor excitement. Later, there was news that the US Department of Justice issued a subpoena to the company amidst escalating antitrust investigations. Broadcom's disappointing sales forecast on Thursday also dimmed the outlook for the entire chip industry.

Rhys Williams, Chief Strategist at Wayve Capital Management LLC, said, "The market environment you are in now is very challenging. No one can say for sure where the bottom is for NVIDIA."

Of course, even with the recent downturn, NVIDIA has still brought investors substantial returns this year. The stock's gains this year still exceed 100%, adding approximately $1.3 trillion to its market cap. Wall Street generally expects that as companies continue to build AI-related infrastructure, NVIDIA will continue to maintain strong momentum, with this process expected to last at least several quarters.

Institutions compilation of data also shows that Nvidia's largest customers - especially Microsoft, Meta, and Amazon, collectively account for more than 40% of Nvidia's revenue. And these tech giants have affirmed their spending plans in the past few quarters.

Nvidia's performance last week actually confirmed this optimistic view, this "artificial intelligence barometer" recorded $30.04 billion in revenue in the second quarter, a year-on-year increase of 122%; adjusted earnings per share of $0.67, both exceeding market expectations, just falling short of the most bullish expectations.

Williams from Wayve Capital pointed out, "For long-term investors, now may be a good time to get in. If I have new funds now, I would be keen to purchase some AI-related stocks."

What about the future market?

Currently, for the future trend of Nvidia, some industry insiders also have their own opinions. Melius Research analyst Ben Reitzes stated that while antitrust pressure is a factor Nvidia investors must pay attention to, other factors may have a greater impact on the company's stock price trends in the coming months.

Reitzes is currently focusing mainly on two points: Nvidia's profit margin performance, and whether the company can maintain growth potential until the 2026 fiscal year. He believes that these two points may be key to determining the future stock price trend of Nvidia in the next six months.

In Reitzes' view, investors had been concerned about the potential impact on revenue of the delayed release of the new Blackwell chip series before the financial report was released, to the extent that they "seemed to forget to consider the impact on profit margins of solving this issue". He wrote, "Now the key for the stock is how and when the gross margin bottoms out and rebounds."

Reitzes expects that as inventory reserves stabilize, Blackwell's revenue/yield will begin to rise, the gross margin will bottom out in the first quarter of the 2026 fiscal year, reaching about 72.6%. But before that, investors need to have confidence in the profit margin trajectory. He wrote, "Once investors feel that Blackwell will once again push up overall profit margins, the stock is likely to rise in the first half of the 2025 calendar year."

In addition, another issue that has recently affected the stock price of Nvidia is the debate around AI and its return on investment. Reitzes pointed out that this is similar to what happened at this time last year - investors began to question whether 2025 would be the peak year for AI investment, as they did not see sufficient widespread adoption of AI.

However, Reitzes believes that investors will soon have more information to validate all of this. For example, he is optimistic about various video generation applications, which may become a key driver of investment and provide more concrete cases throughout 2026, rationalizing further investment in consumer internet applications. OpenAI's next-generation GPT could also create a buzz in the business.

Nvidia's next-generation chip after Blackwell may also arouse people's interest in the near future. Reitzes pointed out, "When we hear more about Rubin at the GTC conference in March next year, this debate is expected to truly ease."

Editor/Emily