Key Insights
- Nvidia stock has slumped from the year-to-date high of $236 to $200.
- Etched, its competitor, has reached a $5 billion valuation.
- Fundamentals and the falling wedge points to a rebound.
Nvidia stock price has crawled back in the past few days, moving from last month’s low of $189.9 to today’s $200. It remains much lower than the year-to-date high of $236. So, will the stock rebound as competition, including from Etched, a Peter Thiel-backed company, jumps?
Nvidia stock has recovered modestly in recent sessions, climbing from last month’s low near $190 to about $200. Even so, the shares remain well below their year-to-date high of $236 as investors assess growing competition from AI chip startups such as Peter Thiel-backed Etched.
Etched’s Growth Highlights Rising AI Competition
Growing competition remains one factor weighing on Nvidia’s valuation. One emerging challenger is Etched, an AI chip startup backed by Peter Thiel, Jane Street, Jump Trading, and Two Sigma.
Unlike Nvidia’s general-purpose graphics processing units, Etched develops application-specific integrated circuits designed for transformer-based AI models such as those powering large language models.
The company’s valuation has reportedly climbed to roughly $5 billion, reflecting increasing investor interest in specialized AI hardware. While Etched remains much smaller than Nvidia, its progress highlights the industry’s growing focus on purpose-built AI chips.
Competition is also expanding elsewhere. Cerebras continues growing its AI computing business, while major cloud providers such as Google, Amazon, Microsoft, and Meta Platforms are investing heavily in custom silicon to reduce reliance on third-party suppliers.
Advanced Micro Devices is also expanding its presence in AI accelerators, competing for enterprise and hyperscale customers.
Even so, Nvidia retains major competitive advantages. The company continues leading the AI accelerator market, supported by its CUDA software platform, which remains deeply embedded across AI development workflows. That ecosystem creates high switching costs for enterprise customers and developers.
Nvidia’s Growth is Still Continuing
Another reason why Nvidia will overcome these challenges is that its revenue growth is not showing signs of slowing down. Data compiled by Yahoo Finance shows that analysts expect its revenue to grow by 96% in the second quarter to $91.7 billion.
It will then grow by 80% in the current quarter to $102.9 billion, with its annual figure hitting $392 billion. These numbers are more conservative as Nvidia has a long track record of doing better than estimates. As such, the estimated $392 billion annual revenue may turn into $400 billion.
Nvidia is also expanding in other areas that may boost its revenue growth in the future. For example, it recently launched its CPUs, which will become popular because of the ongoing AI agent growth.
Nvidia Stock Technical Analysis
Nvidia shares have retreated in the past few months, moving from a record high of $236.57 to $200 today. It now remains between the lower and middle lines of the Bollinger Bands indicators. The stock also remains below the 50-day Exponential Moving Average (EMA).
On the positive side, the stock has formed a large falling wedge pattern, which normally leads to more gains. It also formed a morning star candlestick pattern, a common bullish reversal sign.
It is also about to move above the Major S&R Pivot Point of the Murrey Math Lines. Therefore, the shares will likely continue rising as bulls target the ultimate resistance level of $225. The bullish outlook will be cancelled if it falls below $190.
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