Introduction
NVDA (down by 3.31%today) suffered the biggest nosedips of recent times on Jan 27. Just as the stock was going to be incorported in the Down Jones industraial average index, the downfall happened. It was an unpreceedented setback for the tech stock.
But what now? Is it the end of NVDA or there are chances of revival again?
The stock fell 17% this Jan. This fall was prompted by an innovative Chinese startup DeepSeek AI. Their cost-effective AI model challenged tech giants like NVIDIA to their core.
How Was NVDA’s Recent Streak?
NVDA has been on a breakout streak since 2023. The enterprising AI solutions of the brand were on a different level. In Q1, 2025, NVDA recorded a record 3-figure sales return rate. Still, things changed after Jan 27. The market seems pretty divided now. Investors are confused about the future of their NVDA holdings.
deepSeek’s claims
The DeepSeek R1 model is the course of all major issues, heading NVDA’s way. According to the brand, the R! Model was trained with just $6 million. Compared to the highly expensive 01 reasoning model of ChatGPT, this is nothing!
Through the whole 2022-23 and the major part of 2024, NVDA has yielded massive results for investors. However, the streak of stellar gains came to a standstill once DeepSeek entered the market. The future of all the major tech stocks seems to be at stake now.
DeepSeek has stirred a culture of doing more with less. It triggered concerns about the future of Nvidia’s chips.
Other Issues
The DeepSeek issue is not the only one. Recently, multiple nations put restrictions and limits on imports of NVDA chips. Meanwhile, NVIDIA also slowed down its AI spending, which created further issues. Research says that these issues have been pressing for the last 1 year. However, the problems were exacerbated as DeepSeek stirred it more. You can track the Dow Jones Chart to understand their current standing.
NVDA’s Current Standing
Down by 3.31% at the time of publication, the stock stands at a current price point of $115.58. But there’s one thing that might keep investors hopeful. The market cap of NVIDIA is still $2.8 trillion. The day range of the stock is $114.5 to $119.02. Meanwhile, the 52 week slump is also manageable. It current stands at the range of $75.61 to $153.13.
However, the problem lies with the current dividend yield of 0.03%. Yet, there’s no reason to offboard the stock soon. Most importantly, NVDA is a growth stock. Most investors treat it as a long-term asset.
Current Fiscal Health of The Company
In the Q1 of 2025, NVDA generated $26 billion in sales. Meanwhile, the non-GAAP per-share earnings of the company also came down to $6.12.
But investors can assured about the asset strength of the company. Compared to the same quarter from the last FY, NVDA has grew their sales 262%. Moreover, the gross margin of the company also improved by 12.1 points.
The bottom line is that NVDA is still standing strong from the PoV of its balance sheet. Simultaneously, the cash balance of the chip company grew 2x in 2023. So, it’s still safe to invest in NVIDIA. However, it is difficult to say how much NVDA would expand further so far as the stock price is concerned.
It may grow more in the long term. However, the short-term growth seems dicey, at least after the Jan 27 event. In essence, Evercore ISI’s tech strategist Rich Ross said that NVDA is “still a healthy consolidation.”
Studying the RSI index of NVIDIA he said that NVDA is an oversold stock, no doubt. The number of holdings is phenomenal. However the current RSI of the chip mammoth is 47. Far below the 63 mark, reached in January, just before the massive loss.
What Does the Market Think?
The market is divided into NVDA. a lot of stock specialists say that the stock has a lot of potential left. Meanwhile, people are also going gaga about the podcast that recently aire- NVIDIA at $200 in 4 months. All those who have been investing in NVDA for a long time got something to be excited about at least.
The crux of the discussion is that AI’s growth should not matter much for the chip company. There is a plethora of tech applications where NVDA controls the market. At the same time, people feel that it is not easy to get such readymade stocks like NVDA.
Argument #1
The stock has set a steady course of growth and stood tall for years now. Whereas DeepSeek is still to set foot and make a standing in the market. So they expect a much more short-lived effect.
Argument #2
A Reddit user recently claimed that NVDA is going to make a comeback even sooner. According to the handle, supply, and demand are all that matters. DeepSeek AI has just entered the market. So they are not in a position to claim that the market won;t need to upgrade or purchase new hardware ever.
I mean nit everyone has the sheer genius or the setup to revamp old technology and fit it in for new uses. Most importantly, it is next to impossible to remove the cross dependencies that NVIDIA has created in the market already. They have global buyers, encompassing the market far more than DeepSeek.
More Market Opportunities Ahead
NVDA is revamping their technology, to make it lucrative for the buyers. Potential buyers like Blackwell feel that their GPU architecture will be incomplete without the NVDA chips that support large language models.
Simultaneously, NVDA has the support of frequent government orders too. To top it up, there is demand from data centers too. It is still NVDA’s technology that’s maximizing its utilization. The Gen AI and 5G apps can’t run without NVDA’s hardware. I feel that’s enough to persuade buyers!