Nvidia stock has been a rare July bright spot among chip stocks. But a Friday drop is putting that outperformance at risk.
Shares slipped 0.9%, extending their losses after falling 1.5% in Thursday's session. Nvidia was still faring better tha Advanced Micro Devices and Intel, which fell 2.9% and 5.9%, respectively. The VanEck Semiconductor exchange-traded fund was 3.1% lower.
Nvidia hasn't been performing like a typical chip stock recently. Its shares, up more than 4% in July, have outpaced both Micron and the VanEck Semiconductor ETF, which have lost more than 10% each.
Semiconductor giant Nvidia has appeared to gain ground as investors pivot from broader chip stocks to mega-cap tech. The rally came despite lingering concerns over chip pricing sustainability. As the undisputed leader in high-performance GPUs and AI processors, Nvidia's market position remains virtually unshakeable.
That rotation seemed to backfire this week. After Alphabet's earnings suggested spending on data centers and chips will expand more than once thought, with Wall Street expecting for other companies like Microsoft and Amazon to follow suit, Big Tech -- including Nvidia -- took a beating.
But continued spending on chips and other components for data centers should benefit Nvidia. The recent slide may be more indicative of how investors are treating Nvidia: as a Big Tech stock, akin to Alphabet, instead of a chip name like Micron.
If the trend continues, however, investors may expect Nvidia to outperform, reclaiming its leadership position in chips and beating the rest of Big Tech. Next week should bring clarity, with Microsoft earnings due on July 29 and Amazon set to report the following day.
Write to Jack Denton at jack.denton@barrons.com
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July 24, 2026 15:04 ET (19:04 GMT)
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