New York, Feb 4, 2026, 16:02 EST — After-hours trading
- Nvidia shares dropped 2.7% during regular trading, lagging behind the wider semiconductor sector decline.
- Traders flagged renewed AI-driven selling pressure following AMD’s disappointing outlook, which shook the chip sector.
- Attention shifts to Nvidia’s earnings on Feb. 25 and updates on its rumored OpenAI investment discussions.
Nvidia shares dropped 2.7% to $175.52 in Wednesday’s regular session, after bouncing between $171.93 and $181.70. Semiconductor ETFs took a hit as well, with the iShares Semiconductor ETF shedding 3.8% and VanEck’s chip ETF falling 3.4%.
The move is significant since Nvidia now serves as a crucial barometer for big tech’s appetite for AI hardware spending. When Nvidia’s stock jolts, it often drags the entire “AI trade” along, even without any fresh company-specific news hitting investors’ desks.
The timing is tricky: chip and software investors are wrestling with whether AI’s growth remains a clear upward trend or if it’s starting to wobble, as earnings season pushes companies to reveal what their spending is actually delivering.
Wednesday saw a broad sell-off in chip stocks following a 16% plunge in Advanced Micro Devices after its revenue forecast raised concerns over mounting competition. The Philadelphia SE Semiconductor Index, a key benchmark for U.S. chip shares, dropped 5.4%, Reuters reported. (Reuters)
Nvidia’s CEO dismissed a major worry driving this week’s selloff: that rapid AI advances might render large parts of the software sector obsolete and topple the entire tech stack in one go. “It is the most illogical thing in the world,” Jensen Huang told an AI conference in San Francisco hosted by Cisco. (Reuters)
The debate is playing out in markets, as investors pull funds from certain software stocks, fearing AI tools might undercut established players’ pricing power. Nvidia finds itself caught in the middle, often seen as the go-to proxy for a straightforward “AI up or down” bet.
Aside from the broader risk-off mood, Nvidia grabbed headlines with its ties to OpenAI. According to a person familiar with the matter, Nvidia is closing in on a roughly $20 billion investment in OpenAI’s latest funding round, though the deal isn’t sealed yet. OpenAI CEO Sam Altman praised Nvidia, calling it the maker of “the best AI chips in the world.” (Reuters)
There’s a twist. Reuters reported Monday that OpenAI isn’t fully satisfied with some of Nvidia’s latest chips used for parts of “inference” — the phase when a trained AI model responds to user prompts. Sources said OpenAI has been exploring other options, including talks with AMD and startups. Nvidia maintains that customers still favor its chips for inference due to their performance and cost efficiency at scale. (Reuters)
Nvidia faces the risk that minor changes in how major buyers build AI systems could rapidly shift expectations—especially if clients opt more for custom chips or distribute workloads among multiple suppliers. Coupled with ongoing policy uncertainties around AI chip shipments, the stock often behaves less like a typical company and more like a referendum.
All eyes are on Feb. 25, the day Nvidia will release its quarterly results and host a webcast right after the U.S. market closes. The key question traders are weighing: will Nvidia’s numbers and forward guidance end the debate over AI spending—or just fuel it further? (Nvidia)
