Nvidia shares head for sixth weekly fall, longest losing streak since 2012

Shares in the US chipmaker Nvidia are heading for a sixth straight weekly fall, which would be their longest losing streak since 2012, CNBC reported on Friday, 13 November. Over the six weeks to Thursday’s close the company lost 29% of its value, or roughly $1.6 trillion in market capitalisation, and slipped below Apple.

Market capitalisation is the total value of all of a company’s shares on the stock market. Nvidia was the world’s most valuable company for most of this year.

Selling began before the leadership change

The shares fell 4.3% on Thursday, taking the week’s loss to 11%. That day Jensen Huang, the company’s co-founder and long-time chief executive, stepped down, and finance chief Colette Kress became interim chief executive. But investors had started selling earlier: the shares lost about 9% the previous week, mostly after the US midterm elections, in which the Democrats won sweeping victories and dozens of ballot measures that could slow the build-out of artificial intelligence infrastructure were passed, CNBC said.

Before the elections Nvidia had been falling with the rest of the AI sector on worries that rising interest rates would hurt heavily indebted companies. Nvidia itself is highly profitable, but several of its big customers rely on borrowing.

Results on Tuesday

Nvidia reports quarterly results on Tuesday, 17 November. Analysts expect revenue to rise 91% from a year earlier to $108.9 billion, according to LSEG. Gil Luria, an analyst at D.A. Davidson, cut his price target to $200 from $300, saying the company faced “a challenging transition” over the next few months. Analysts at Oppenheimer said they expected fundamentals to take a back seat in the near term.