NEW YORK, July 29, 2026, 04:32 EDT
- Nvidia shares slipped 0.48% to $196.07 in premarket trading.
- The company’s market value dropped by an estimated $238 billion over two sessions, according to an initial assessment.
- Meta Platforms, Inc. NASDAQ:META and Microsoft Corporation NASDAQ:MSFT are both scheduled to release their reports later Wednesday.
Nvidia slipped further ahead of the opening bell on Wednesday, as the ongoing valuation adjustment continued. The main Nasdaq session was shut, but premarket activity was in progress.
The absolute value is more significant than the percentage change. Nvidia’s drop in market value over two sessions was roughly 4.7 times its most recent quarterly operating cash flow.
Investors are questioning the sustainability of capital spending on artificial intelligence. Demand for chips is currently robust.
Nvidia ended Tuesday’s session at $197.01, up 0.25%. This small rebound came after a 4.99% drop on Monday. Shares remained 4.75% under Friday’s close of $206.84.
Based on Nvidia’s 24.2 billion outstanding shares, an initial estimate places the company’s market value drop between Monday and Tuesday at about $237.9 billion.
| Nvidia investor measure | Amount | Comparison |
|---|---|---|
| Preliminary two-day decline in market value | $237.9 billion | 4.7 times Q1 operating cash flow |
| Operating cash flow for Q1 | $50.3 billion | 61.7% of the revenue for the quarter |
| Data Center revenue in Q1 | $75.2 billion | Constitutes 92.1% of total revenue |
| Market capitalization as of Tuesday | $4.77 trillion | 30.17 times trailing earnings |
The calculation does not factor in Wednesday’s premarket drop. It also presumes the reported share count stayed largely unchanged.
Nvidia’s earnings structure highlights its vulnerability. Data Center generated $75.2 billion in revenue during the first quarter, out of an overall $81.6 billion in total sales.
Supplier data indicates robust demand might not be enough for investors. Shares in SK hynix Inc. KRX:000660 dropped 9.6% on Wednesday after the company’s record quarterly profit came in below forecasts.
“Being strong is no longer sufficient in the current AI market,” stated Gary Tan, portfolio manager at Allspring Global Investments. Reuters
The operational outlook stayed strong. SK hynix President Song Hyun-jong stated, “Major customers are still requesting more memory supply.” Reuters
Nvidia has projected ongoing expansion in its own outlook, anticipating second-quarter revenue to reach $91 billion, with a possible variance of 2%. This projection does not include any data centre compute sales to China.
Chief Executive Jensen Huang stated that the pace of AI-factory construction was “accelerating at extraordinary speed.” First-quarter revenue increased by 85% compared with the same period a year ago. NVIDIA Investor Relations
Investors are seeking evidence from Nvidia’s biggest clients as market pressure mounts. Microsoft and Meta are set to report their results later on Wednesday, while Amazon.com, Inc. NASDAQ:AMZN will announce its figures on Thursday.
Investors are set to monitor cloud expansion, expenditure, and cash generation. Revenue-supported investment could underpin Nvidia’s high valuation. Continued weakness in cash flow would heighten worries over AI profitability.
Nvidia is not the only company under pressure. The PHLX Semiconductor Index (INDEXNASDAQ:SOX) dropped 4.5% on Tuesday and remained roughly 25% under its record closing high reached on June 22.
Nvidia maintained a market value of $4.77 trillion on Tuesday. The company’s trailing price-to-earnings ratio was recorded at 30.17. Anticipation continues to run high.
Risks: Nvidia’s outlook does not factor in China data-centre compute revenue. Export restrictions continue to pose a direct risk to earnings. Infrastructure projects may also face delays if rates rise or customer cash flow declines.
The upcoming indicator will be customer economics rather than chip benchmarks. Wednesday’s results need to demonstrate that AI capacity is generating revenue.
Related articles: NASDAQ:NVDA
