Analysts predict possible price decline for Nvidia

The success story of Nvidia could face some challenges in the coming years, according to analysts. The graphics processor giant, which has significantly benefited from the increasing demand in the technology sector and the use of GPUs for AI applications, could face a potential halving of its share price to 65 dollars. A key revenue driver, AI model training, is at risk of declining as returns from increasingly large models could decrease. This could lead to reduced spending on procuring GPUs, while competitors like AMD and Intel may gain market share from Nvidia in AI inference. Additionally, competition from custom chipsets developed by tech giants like Amazon and Google adds pressure on Nvidia. With the easing of the GPU supply situation at Microsoft, the end of a boom in demand is suspected, which could put pressure on pricing. Analysts also warn that Nvidia's revenues, which have nearly tripled in the last 12 months, could increase by only 10% over the next two years. This could reduce profit margins from the current 50 to around 35 percent. A change in US monetary policy or a reevaluation of the company's growth status could drastically lower the price-earnings ratio value from the current 44x to 25x.