What happened: Nvidia (NVDA) stock tumbled more than 4% on Thursday as other chipmakers gained.
What’s behind the move: Investors may be weighing rising competition for Nvidia, which has so far been the dominant play in the AI infrastructure space. In its earnings call on Wednesday, Amazon (AMZN) noted its in-house chips business is booming, while Alphabet’s Google (GOOG, GOOGL) said it plans to sell its custom Tensor Processing Units (TPUs) to select customers who will install the chips in their own data centers.
Meanwhile, a crackdown on chip smuggling in China has nearly doubled prices for Nvidia’s B300 servers to $1 million each, according to a Reuters report. Nvidia’s most powerful server is restricted in China.
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What else you need to know: Amazon’s and Google’s in-house chips are different than the ones Nvidia offers, and the AI chip heavy has largely dismissed any fears that other tech giants will erode its lead in the space, saying that its chips offer greater flexibility for AI developers.
Amazon and Alphabet are also big buyers of Nvidia’s AI infrastructure hardware.
Thursday’s price action created a mixed picture for semiconductor stocks. Qualcomm (QCOM) surged 14% as it moves further into the data center space. Memory and storage players Sandisk (SNDK), Western Digital (WDC), and Seagate (STX) also rose as Microsoft and Meta on Wednesday noted rising costs for data center buildouts.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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