"It's hard to move the needle on shares of Nvidia ( NASDAQ:NVDA) these days. Even though the stock has continued to drag its feet into the new year, with shares currently down just over 3% year to date, there have been several bullish developments that I thought have reignited a bit of enthusiasm for the GPU maker. AI demand isn't just staying hot; it's hot enough that supply can't keep up."
"Either way, until the AI-native companies, the mega-cap tech titans, and other firms scrambling to keep up choose to scale at a slower pace, I do think the GPU trade has another couple of good years up its sleeves. In the meantime, though, investors are going to be more skeptical of new developments, partnerships, or commentary delivered by visionaries like Nvidia's top boss Jensen Huang."
Nvidia stock has shown limited movement, down just over 3% year-to-date, despite a string of bullish developments. AI demand is strong enough that supply cannot keep up, driven by high-bandwidth memory shortages, fabs at full capacity, and other bottlenecks. Long lead times and the semiconductor industry's boom-and-bust dynamics create a tangible risk of supply overshooting within the next three years. Continued rapid scaling by AI-native firms and mega-cap tech companies should sustain GPU demand for several more years. Investor skepticism may rise around new announcements and executive commentary despite production and efficiency gains such as Vera Rubin reaching full production early.
Read at 24/7 Wall St.
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