There’s no getting around it: The advent of artificial intelligence (AI) early last year has been a boon to chipmaker Nvidia (NASDAQ: NVDA). The company’s graphics processing units (GPUs) have long been the gold standard for video games, data centers, and early branches of AI.
The uptake of generative AI kicked off in earnest in early 2023, making Nvidia the hottest ticket in town. Shares are up nearly 700% during that time as the company controls an estimated 92% of the data- center chip market — where most generative AI lives — according to IoT Analytics. Those gains haven’t all been in a straight line, however, as Nvidia stock plunged as much as 23% during the last three weeks of July.
Behind the slump are fears that the adoption of AI might soon trail off. After the company generated triple-digit revenue and profit growth over the past year, investors have begun to wonder if the…
