Nvidia’s $1 Trillion Slide Sends Valuation to Pre-AI Boom Levels

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(Bloomberg) — After losing roughly $1 trillion in market value in less than two months, Nvidia Corp.’s stock is the cheapest it’s been since before the AI boom kicked off and sent the shares into the stratosphere.

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The chipmaker’s graphics processing units, or GPUs, still dominate the artificial intelligence data center market. But the stock has tumbled 16% since hitting an all-time high on May 14, as investors rejigger the AI trade by ditching Nvidia in favor of competing semiconductor manufacturers, particularly those in the memory market. 

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The selloff has Nvidia, not long ago the hottest stock on Wall Street, trading at 18 times earnings projected over the next 12 months, according to data compiled by Bloomberg. The last time the shares were this inexpensive was early 2019. To get a sense of how dramatically it has fallen off, the erstwhile market leader is now cheaper than the S&P 500 Index, which is priced above 20 times forward earnings, and the technology-heavy Nasdaq 100 Index, which is at almost 23 times.

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Nvidia’s shrinking valuation isn’t the result of a deteriorating outlook. On the contrary, Wall Street analysts have been raising their profit estimates for the coming quarters. Instead, the selloff shows how much the AI trade is shifting to other areas, such as memory and storage stocks like Micron Technology Inc. Even Nvidia rivals such as Advanced Micro Devices Inc. and Intel Corp. have seen their share prices double or even triple this year.

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“Sentiment has moved on,” said Michael Bailey, director of research at Fulton Breakefield Broenniman. “You’re seeing these companies where expectations were very low — the Microns of the world — stealing the spotlight.” 

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Nvidia is expected to deliver the fourth-fastest revenue growth in the the S&P 500 this year, but it’s still cheaper than about half of the stocks in the index, including candy maker Hershey Co. and the utility Dominion Energy Inc., according to data compiled by Bloomberg. Considering how steady Nvidia’s revenue growth and profitability have proven to be, the company looks undervalued at current levels, according to Randy Hare, director of equity research at Huntington Bank.

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“Stocks follow earnings,” said Hare, who’s betting Nvidia shares will resume their climb in the coming months. “It’s a consistent performer.”

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After soaring more than 1,100% from the end of 2022 through 2025 amid surging demand for its GPUs, Nvidia’s shares have stalled. They’re up just 5.6% in 2026, trailing the S&P 500’s 9.6% gain and the Nasdaq 100’s 16% rise. Meanwhile, the Philadelphia Stock Exchange Semiconductor Index has jumped 74%, putting it on pace for its best year since 2003.

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The chip index is being led by Micron, which is benefiting from soaring prices for high-bandwidth memory chips. It’s up 229% in 2026 after soaring 239% in 2025 to also lead the gauge. Nvidia, on the other hand, is the third-worst performer in the benchmark of 30 semiconductor-related stocks. It was the second-best stock in the index in 2024 and in the middle of the pack last year.