nvidia weathers a storm: stock dips amid super micro woes and trump's trade winds

2025-05-01 nvidia

Washington, Thursday, 1 May 2025.
nvidia’s stock took a hit, dropping 4% as super micro’s earnings disappointed. compounding concerns, the potential return of trump’s trade policies looms. this raises fears about ai demand and trade restrictions, casting a shadow on nvidia’s outlook. super micro, a key partner, saw its shares plummet 15% due to lowered revenue expectations, intensifying anxieties about ai investments. investors are now wary of potential shifts in the ai landscape and the impact of protectionist measures.

analyst downgrade adds to nvidia’s woes

Nvidia faced further headwinds when Seaport Research Partners downgraded the stock to a ‘sell’ rating, setting a price target of $100 [4]. This marked the first ‘sell’ rating for nvidia since August 2023 [4]. Jay Goldberg, a Seaport analyst, suggested that nvidia’s prospects are already well-understood and largely factored into its stock price [4]. Goldberg also noted the complexities involved in deploying nvidia’s systems, including cooling and supply chain coordination [4]. He raised concerns about the increasing skepticism surrounding the practical benefits of ai and the possibility of ai budgets slowing down in 2026 [4].

super micro’s revised outlook

Super micro computer inc., a key nvidia client, released preliminary third-quarter results that fell significantly short of expectations, contributing to nvidia’s stock decline [5]. super micro anticipates net sales of $4.5 billion to $4.6 billion, below the previous forecast of $5 billion to $6 billion and the consensus estimate of $5.41 billion [5]. the company projects non-gaap earnings per share of $0.29 to $0.31, also lower than prior expectations of $0.46 to $0.52 and the consensus of $0.54 [5]. these revisions intensified concerns about potential reductions in ai-related investments [6].

market reactions and competitive landscape

The ripple effect of super micro’s announcement extended to its competitors, with dell’s stock dropping by 4.8% in after-hours trading [5]. D.A. Davidson analyst Gil Luria suggested that several large hyperscale data center clients might be adjusting their data center plans due to economic weakness, equipment tariffs, and potential delays in nvidia’s ‘blackwell’ product deliveries [6]. Despite the introduction of new semiconductor products, analysts anticipate continued demand for older generation ai chips due to supply constraints of advanced processors [6].

trade tensions and future uncertainties

Growing trade tensions between the us and china are adding another layer of uncertainty [3]. Investors are closely monitoring these tensions, along with evidence of demand in the ai manufacturing sector [3]. Concerns about potential tariffs imposed by the trump administration are also contributing to investor unease [6]. Running point capital’s chief investment officer, michael ashley schulman, attributed super micro’s struggles more to company-specific issues than broader industry challenges, though he acknowledged tariffs could be influencing market sentiment [6].

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