Nvidia shares decline amid concerns over sustainability of data center demand growth following record $5 trillion market cap.
Nvidia (NVDA) stock fell for the second consecutive session Friday, retreating from its all-time high despite reporting stronger-than-expected first-quarter earnings. The chipmaker’s market capitalization had briefly reclaimed $5 trillion last week during a seven-day rally, driven by surging demand for AI chips in data centers.
Analysts noted the stock’s recent gains appeared parabolic, raising questions about valuation even as earnings exceeded estimates. The Dow Jones Industrial Average, meanwhile, hit a record high this week, underscoring broader market strength despite Nvidia’s pullback.
Shares remained under pressure as investors weighed whether the company’s growth trajectory can justify its elevated valuation. The stock’s decline contrasted with the broader market’s upward momentum, including gains in Walmart and other blue-chip names.