NVIDIA Corp stock dropped Monday amid reports that a company executive had met with Chinese officials.
Shares in the semiconductor manufacturer, which have tripled in value over the past year, declined 4.2% to $136.02. The stock has retreated since last week's earnings, even though the results exceeded Wall Street's expectations.
The challenge for Nvidia now is living up to the market's incredibly high expectations for future earnings. Wall Street expects 54% revenue growth in 2025. Though the strength of demand for Nvidia's high-powered artificial intelligence chips continues to grow, investors risk asking for more than the company can deliver if they ramp up their demands even faster.
In a sign that China remains an important market for the chip maker despite President-elect Donald Trump's plans to escalate trade tensions, Nvidia's head of worldwide field operations Jay Puri met with China's vice commerce minister in Beijing on Monday, Reuters reported.
Tim Cook, CEO of tech peer Apple, is also visiting the world's second-biggest economy, showing up at a conference on supply chains, the South China Morning Post reported.
Apple, the maker of iPhones, and Nvidia are vying for the title of world's most valuable company -- both currently have market capitalizations of about $3.5 trillion.