NVIDIA Stock Plummets – Wipes Away 18 Months of Gains In Two Days
NVIDIA stock today has seen its losses on the market extend to a second consecutive red session. Share prices were heavily battered after the chip-maker posted disappointing third-quarter results last week, which wasn't helped by swirling (debunked) rumors of an impending 2080 Ti recall due to manufacturing defects.
Friday NVIDIA (NASDAQ: NVDA) suffered through one of its worst ever days as shares of the company sunk like a rock, to the tune of minus 19 percent after it failed to meet analyst expectations on both revenue and earnings. We delved into the reasoning behind the massive drop here in our post-earnings piece. The bottom line is that cryptocurrency related demand has fallen off a cliff, NVIDIA is faced with mounting inventory, and its latest Turing line of graphics cards are not seeing good market traction due to inflated pricing versus the previous Pascal generation of products.
Now today prices have sunk a further 6 percent which means NVDA is trading at levels not seen since the summer season of 2017.
Gasoline was thrown on the fire yesterday when Eteknix reported that NVIDIA had completely pulled the 2080 Ti from its website. The website then updated its post to say that the 2080 TI's were simply out of stock and weren't available to view on the website because of this. We can at least say NVIDIA is NOT pulling 2080 Ti's at this time, which makes this rumor unfounded.
It's no secret that some users around the world have been reporting 2080 Ti failure rates above the norm. Something hovering on the fringe here that COULD be driving down the price even further is an ambiguous post by an NVIDIA employee discussing "Limited test escapes". The post in question. It's not clear what they mean by "limited test escapes", perhaps they are test units not meant for the sales channel that slipped by. The uncertainty of the matter isn't doing NVIDIA any favors on the stock market, that much is certain.
NVIDIA certainly hasn't been helped by the overall sell-off in tech we've seen in recent weeks, however, given NVIDIA's dominance in the market, any loss of investor confidence in NVIDIA could send the rest of the market tumbling, so it's hard to say which precedes which.
It's always somewhat fuzzy when you try to separate a chip giant like NVIDIA from macro-market moves for the tech sector as a whole. Over the weekend we touched on the overall market as it pertains to technology stocks here as well. If you have any interest in the market as a whole I suggest you head on over for an excellent piece of analysis and explanation of different factors that are driving things.