Challenge for Nvidia: High Expectations in Changing Times

Nvidia undeniably remains the flagship among tech stocks, but recent weeks have shown a decline in enthusiasm. To truly impress the markets, it is no longer sufficient for the company to simply present great numbers or even significantly exceed Wall Street's high expectations. Nvidia must shatter records. A short-term decline of nearly 8% following the earnings announcement by December 10 may disappoint some investors, but over a longer time horizon, such price movements are insignificant. The crucial question is where Nvidia will position itself in five years. The field of Artificial Intelligence (AI) is growing rapidly and is expected to have a lasting impact on the markets. PwC forecasts that AI could contribute $15.7 trillion to the world economy by 2030. Nvidia is at the center of this development, far beyond their chips. Under the leadership of Jensen Huang, the company demonstrates an unprecedented vision and always stays one step ahead of the competition. Nvidia dominates not only in theory but also with its products. The demand for the new chip generation Blackwell is enormous, underpinning the company's impressive growth momentum. A minimal flaw in the third-quarter forecast is the slightly declining gross margin. Yet even the current margin of 74.6% is impressive, and according to the CFO, it will stabilize over the course of the year. While Nvidia is currently operating at a high, challenges still lie ahead. On a macroeconomic level, the question remains whether the investments are proportionate to the benefits. Companies like Alphabet and Microsoft are making record investments in AI infrastructure, which simultaneously fuels skepticism and hope.