Nvidia's AI Slowdown Is On The Horizon (Rating Downgrade) (NASDAQ:NVDA)
Summary
- I am downgrading Nvidia Corporation from a Strong Buy to a Buy due to potential AI infrastructure slowdown, margin pressure, and increased competition.
- Nvidia delivered another strong quarter with 33% EPS growth and a 69% YoY revenue increase, but future beats may be less frequent.
- AI infrastructure spending is likely to slow as hyperscalers reach capacity, which could impact Nvidia's growth and profitability from 2026 onward.
- My 2025 price target is now $165, down from $180, reflecting tempered expectations for revenue, margins, and EPS growth.
BING-JHEN HONG
I'll be honest, there was a moment when I doubted Nvidia Corporation (NASDAQ:NVDA) during the recent AI-propelled tariff-induced selloff. DeepSeek (DEEPSEEK), the potential AI infrastructure spending slowdown, tariffs, fears over margins, and other factors stirred up
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Analystâs Disclosure: I/we have a beneficial long position in the shares of AVGO, AMD either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
I am long a diversified portfolio with hedges.
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