Key Insights
- NVIDIA stock price could be at risk as competition soars.
- Companies like Google, Microsoft, and Amazon are building their own chips.
- Technical analysis suggests that the stock may drop soon.
NVIDIA stock price has remained in a consolidation phase in the past few months and is underperforming the broader market. It is stuck in a correction after falling 11% from its 2025 high, and technicals point to a retreat amid rising threats from its biggest customers.
NVIDIA at Risk as Top Customers Build Their Own Chips
NVIDIA became the world’s largest company by building GPUs that dominate the AI data center market. Blackwell, its most premium chip, has helped propel companies like OpenAI and Anthropic into multi-billion-dollar juggernauts over the past few years.
This dominance, however, is now at risk as its top companies continue building their own chips. OpenAI, the creator of ChatGPT, is working with Broadcom to create its own chips as it seeks to cut its reliance on NVIDIA. It is also working with AMD, which gave it the right to acquire a 10% stake in the company.
Google, on the other hand, has built its Tensor chips, while Amazon is working on its Tranium chips. In a major announcement on Monday, Microsoft said that it was working on the Maia 200 chip, which will run on its data centers first and then be made available to a wider customer base.
Google, OpenAI, NVIDIA, Microsoft, and Amazon are currently NVIDIA’s biggest customers, with Microsoft accounting for between 15% and 20% of its total revenue.
Like Microsoft, Google has announced that it will start to sell it Tensor chips to third parties. This explains why its stock has jumped and its market capitalization has moved above $4 trillion.
ASIC chips pose a major long-term threat to NVIDIA. A good example of this is Apple, which used to rely on chips from Intel a few years ago.
The company developed its own M chips, which it now uses across its devices. These chips have made their devices much better compared to when it relied on Intel. It is one of the top reasons for Intel’s ongoing woes.
NVIDIA Has its Key Benefits
Still, NVIDIA has some advantages that may help it beat its top clients. For one, it is in the pole position in the AI GPU industry. Therefore, its chips may be better than the upcoming ones.
Additionally, the company is expanding its products, which may help it continue its revenue growth. In a statement on Monday, it said that it was investing an additional $2 billion in CoreWeave.
As part of this investment, it also noted that it was building Vera, a Central Processing Unit (CPU) that will compete with Intel’s Xeon and AMD’s EPYC. This is a major announcement as the company does not build CPUs.
Additionally, the company has already received orders worth over $54 billion from China. These H200 orders have not been factored in its average revenue estimates for this year. This means that its revenue and profitability growth will be better than expected.
NVIDIA Stock Price Technical Analysis
Technical analysis suggests that the NVDA stock price could be at risk of a big dive in the coming weeks. It has formed a head-and-shouders pattern, a common bearish reversal pattern.
The stock has also formed a bearish divergence pattern. For example, the Percentage Price Oscillator (PPO) has continued moving downwards and is nearing the zero line. The Relative Strength Index (RSI) has continued falling and is attempting to move below the neutral level at 50.
Therefore, the likely scenario is that it has a strong bearish breakout in the near term. If this happens, the next key level to watch will be at $150. A move below that level will be at $128.
On the other hand, a move above the shoulder at $196 would invalidate the bearish outlook and signal more gains.
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