$NVIDIA (NVDA.US)$ CEO Huang Renxun stated at a technology conference organized by Goldman Sachs on Wednesday that due to limited product supply, some customers feel frustrated and the company's relationship with these customers has become tense.

Huang Renxun said: "The demand is very strong, everyone wants to be the first to receive the goods, and everyone wants to receive the most products." "We may now have more emotional clients, and that's natural. The situation is now a bit tense, and we are doing our best." He added that demand for the latest generation of chips, the Blackwell GPU, is strong, and suppliers are catching up.

In addition, when asked whether large-scale artificial intelligence spending provides a return on investment for clients - which has been a concern throughout the artificial intelligence boom - Huang Renxun said that besides embracing 'accelerated computing', companies have no choice. He pointed out that Nvidia’s technology speeds up traditional workload processing and can handle artificial intelligence tasks that older technologies cannot.

Huang Renxun also mentioned that Nvidia is highly dependent on semiconductor production because the latter is leading in the field of chip manufacturing. He added that most of the company's technology is self-developed and has the ability to transfer orders to other suppliers, but such changes may lead to a decline in chip quality. He said, 'The sensitivity of Taiwan Semiconductor and their ability to meet our demands is incredible. We chose them because they are truly outstanding. But if necessary, we can certainly activate other suppliers as well.' $Taiwan Semiconductor (TSM.US)$ CEO Huang Renxun stated at a technology conference organized by Goldman Sachs on Wednesday that due to limited product supply, some customers feel frustrated and the company's relationship with these customers has become tense.

Nvidia once again became the 'savior' of U.S. stocks.

Huang Renxun's remarks about the 'huge demand for AI chips' can be said to have saved the U.S. stock market on Wednesday, causing major stock indexes to completely erase their intraday declines at the close, achieving a V-shaped rebound, and the gains in technology and chip stocks were particularly impressive.

The data shows that on Wednesday, the Nasdaq rose by nearly 8.4% to a high of $117, after briefly dipping below $107 in early trading, as Huang Renxun's speech led to a continuous expansion in the percentage increase. Nvidia closed at $116.91, up 8.15% on Wednesday.

Driven by Nvidia's rise, the S&P 500 index reversed its initial drop of 1.6% to a rise of over 1%, while the Dow Jones index turned around from an initial 1.8% drop to a 0.3% rise, and the Nasdaq index switched from a 1.4% initial drop to a rise of over 2%, with an intraday swing of over 630 points or 3.8%. The Philadelphia Semiconductor index turned from a 1.4% drop to a nearly 5% rise.

Some analysts pointed out that this is the first time since October 2022 that the S&P 500 index and the Nasdaq 100 index completely erased at least a 1.5% intraday selloff. It can be said that Nvidia single-handedly erased the impact of the August CPI data on US stocks earlier on Wednesday.

Nvidia's stock price has surged nearly 500% in the past 12 months. However, Nvidia experienced a 14% drop last week, resulting in a $400 billion market cap evaporating. Investors are now beginning to worry that the AI boom driving the stock market rally may soon wane due to slowing economic growth, and are unsure whether the massive AI-related expenditures by companies will generate substantial returns.

Therefore, many analysts have expressed that Huang Renxun's speech was seen as an opportunity to calm investor anxieties. Despite sounding somewhat 'Versailles,' Huang Renxun's emphasis on the 'huge demand for AI chips' is seen as key to the reversal of Nvidia's stock price and the US stock indices. Huang Renxun also stated that generative AI is still in its infancy, and it will expand beyond data centers into more areas, igniting imagination for future growth.

Some media pointed out that the $Oracle (ORCL.US)$ The financial report has made people realize that the demand for NVIDIA's AI chips is expected to remain strong. In addition, xAI, an AI startup company under Musk's umbrella, is heavily using NVIDIA GPUs to build its Colossus AI training infrastructure. Meta has long planned to purchase billions of dollars worth of NVIDIA chips by the end of this year. NVIDIA's customers also include Microsoft (MSFT.US) and others. These large tech customers that are focused on expansion are enough to make NVIDIA dominate the AI chip market.

What is the outlook for Nvidia's stock? Wall Street's major firms have differing opinions.

Nvidia announced Q2 revenue and earnings per share at the end of August, both of which far exceeded expectations. Q2 revenue increased significantly by 122% year-on-year, with an adjusted (under NON-GAAP) earnings per share of $0.68, a 152% year-on-year increase, surpassing analyst expectations of $0.64. However, in the second quarter, Nvidia's performance exceeded expectations by the smallest margin since the most recent 6 fiscal quarters.

In terms of overall performance expectations, NVIDIA is expected to generate approximately $32.5 billion in revenue for the third fiscal quarter ending in October, indicating a potential increase of around 80% from the same period last year, higher than the analysts' average estimate of $31.7 billion. However, the market has an astonishingly high expectation for NVIDIA's Q3 revenue, reaching as high as $37.9 billion, which has to some extent raised concerns about its explosive growth slowing down.

NVIDIA's stock price experienced significant fluctuations after the release of its latest financial report, partially due to a series of weak U.S. economic data. In addition, NVIDIA's high stock price is also a reason that some investors are not bullish on it. NVIDIA's price-to-earnings (PE) ratio after its performance announcement was slightly higher than 56x, previously approaching 80x in July.

However, according to the well-known Goldman Sachs analyst Toshiya Hari, NVIDIA was oversold last week. Toshiya Hari maintained a 'buy' rating on NVIDIA this week. He said, 'The recent performance of NVIDIA has not been very good, but we still remain bullish on this stock. Firstly, there is still a very strong demand for accelerated computing. We tend to spend more time on mega-sized enterprises such as Amazon, Google, Microsoft, and other global large-scale enterprises, but what you will see is that the scope of demand is expanding to enterprises and even sovereign countries.'

Goldman Sachs pointed out that with profound technological changes such as artificial intelligence, 'making determinations based on short-term cost and return economics will be futile.' The focus will be on the long term. Goldman Sachs estimates that by the second half of 2025, generative AI will begin to make a substantial contribution to industry growth.

When discussing NVIDIA, Toshiya Hari stated, 'Their competitive position remains very strong, and we do believe that in the commercial chip field, NVIDIA is the top choice, even compared to custom chips, they also have an advantage in terms of innovation speed.'

However, Citi's U.S. stock strategist Scott Chronert believes that NVIDIA may be evolving into a large, conventional growth stock that is no longer exciting. He warned during the sharp drop in NVIDIA last week, 'Simply look at the deceleration in the growth rate of their forward guidance for performance, and you will find that its most profound performance and fundamental impact on the market may have already passed.'

Huang Renxun's significant sale of NVIDIA is not a 'top escape'

It is worth noting that Huang Renxun's recent significant sale of NVIDIA has led to speculation about whether he is 'escaping the peak.' It is reported that in a series of trades from June 13 to September 4, Huang Renxun sold nearly 5.3 million shares of NVIDIA stock at a price of 0.12 million shares per transaction, totaling approximately $0.633 billion.

The data shows that Huang Renxun has been selling Nvidia stocks worth about $14 million almost every day in the past few months. However, Huang Renxun's recent stock sales plans were all conducted through the 10b5-1 trading rule, which means that the stock sales are not panic selling or so-called "selling at the top". According to the latest documents from the U.S. Securities and Exchange Commission (SEC) on September 5th, these trades are part of the 10b5-1 trading plan developed earlier this year. Under this plan, Huang Renxun will sell up to 6 million shares of Nvidia stocks before March 31, 2025.

Regarding why Huang Renxun has been selling Nvidia stocks intensively, a former U.S. company executive analyst said, "He may have to sell some stocks to pay taxes, or for some other daily expenses, or to buy property, because their cash compensation may not be enough to cover these expenses. And Huang Renxun holds too many Nvidia stocks, the amount sold only accounts for a very small portion of what he holds, not enough to make you think he is trying to create a high-priced sell-off." Huang Renxun is the largest individual shareholder of Nvidia, and as of August 9th, he holds approximately 3.5% of the company's outstanding shares.

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