2 min read
Nvidia’s (NVDA) stock is enduring an early summer swoon.
The insight: Nvidia shares have now underperformed the S&P 500 (^GSPC) for six straight trading days, according to Yahoo Finance AlphaSpace data. This marks the longest stretch of relative underperformance since September 2025.
The AI darling has had a mixed performance in the second quarter, which ends today.
Nvidia hit an all-time high closing price of $235.47 on May 14, but the stock has pulled back meaningfully since then, by about 23%.
What’s behind the move: Nvidia’s recent underperformance relative to the S&P 500 has been primarily driven by an institutional sector rotation out of high-flying AI hardware stocks and into specific subsectors such as memory chips.
Wall Street is also growing increasingly impatient with Big Tech’s astronomical capital expenditures on artificial intelligence, which are projected to balloon 70% to more than $700 billion this year.
Factor in concerns about a Fed rate hike later this year, which would increase the cost of financing for AI projects, and it makes sense that Nvidia has begun to lag a bit.
“A lot of them [are] getting treated like bear market stocks,” Wedbush tech analyst Dan Ives said on Yahoo Finance’s Opening Bid about the weakness in top tech stocks.
The bottom line: The next positive catalyst for Nvidia could be the start of hyperscaler earnings season in a few weeks, where strong capex plans may ignite renewed interest in Nvidia. Until then, a further swoon in the stock may be in the cards.
Brian Sozzi is Yahoo Finance’s Executive Editor and a member of Yahoo Finance’s editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
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