Chipmaker Nvidia’s stock is down slightly in premarket trading on Monday, following a drop on Friday. The decline comes as the company faces increased scrutiny from regulators and a recent analyst downgrade.
Nvidia’s dominance in the AI chip market has attracted the attention of authorities in the US, France, and the European Union. While no formal action has been taken, regulators are concerned about a potential bottleneck in Nvidia’s chip supply.
Adding to the pressure is a downgrade from New Street Research, citing concerns about Nvidia’s valuation and its ability to continue growing. However, other analysts remain bullish on the company, highlighting Nvidia’s strong track record of innovation.
Despite the recent headwinds, Nvidia’s stock has still soared 154% year-to-date, significantly outperforming the broader market. Investors are now looking ahead to the company’s next earnings report in August for a clearer picture of its future prospects.
In contrast, shares of Nvidia’s competitors, Advanced Micro Devices and Intel, are up in premarket trading. This suggests that some investors may be rotating out of Nvidia and into other chipmakers.
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