NVIDIA, known for its cutting-edge AI-dependent GPUs and chipsets, has been one of the strongest performing stocks in the US stock market in 2023 and 2024. The company benefited significantly from the growing use of AI and demand for its chips.
NVIDIA’s performance so far
However, at the start of 2025, the bullish momentum on Wall Street has slowed, and NVIDIA‘s stock price is seeing a lack of momentum.
However, the history of the US stock market or Nvidia has been quite tricky, and with a potential market drop based on excessive Wall Street heat, the chipmaking giant could be facing some major problems by the end of 2025.
Reasons for a possible decline in 2025
1. Valuation question
- Overvaluation risk: NVIDIA’s current price-to-earnings (P/E) ratio is historically very high. This means that the stock is already valued far above investor expectations.
- If the company does not live up to its projected revenue and growth expectations, the stock could fall prey to a correction.
2. AI Hype Cycle
- The need for AI and its expansion is real, but if the success of AI projects does not happen as fast as investors have expected, it could affect both the sector and NVIDIA.
3. Competition and market conditions
Chipmaking companies like AMD, Intel are trying to capitalize on the demand for AI chips to challenge NVIDIA’s market share.
The possibility of a recession in the US stock market remains in 2025, which could be harmful for high-growth stocks like NVIDIA.
4. History hints
NVIDIA has already faced four major stock crashes:
2001 (dot-com bubble)
2008 (global financial crisis)
2018 (crypto-boom and bust)
2022 (tech sector crash)
One thing has been common in all these incidents: whenever the sector or the market declined, NVIDIA’s performance was badly affected.
यह भी आप जरुर पढ़े बड़े काम की खबर
Will NVIDIA stock crash in 2025?
- Chances: NVIDIA stock may see a minor correction rather than a complete crash.
- Key factors:
- Bearish market conditions.
- Some kind of temporary decrease in AI demand.
- Loss of investor confidence due to high valuations.
AI overhype and its impact
The fall of NVIDIA will not be limited to its stock. These companies may be affected if the AI sector falls:
- Broadcom and Apple: These companies have a heavy reliance on AI technology.
- Palantir Technologies: A decrease in demand for AI data analytics may cause major losses for them.
- Meta and Google: Despite having operations other than AI, their growth may decline.
NVIDIA stock is definitely overvalued right now, but whether it will crash completely or not will depend on several market factors.
A recession in 2025 and a decrease in AI demand could be a big risk for NVIDIA and other AI companies.
Frequently Asked Questions
Will NVIDIA stock continue to grow?
Yes, NVIDIA stock has been rising so far thanks to its AI-driven strategy. But its growth rate may be slowing.
Has NVIDIA stock fallen recently?
No, NVIDIA stock hasn’t fallen recently, but its growth has slowed.