After enjoying remarkable success between the beginning of the artificial intelligence (AI) boom in late 2022 and the start of 2025, Nvidia (NASDAQ: NVDA) entered a period of deep stock market decline.
The Liberation Day tariffs, announced late on April 2, made the April 3 session especially damaging and ensured that NVDA finally crashed back under $100 for the first time since September 2024.
Still, looking at the entire 2025 chart, it becomes evident that Nvidia shares’ drop cannot be linked to a single factor, and, as sharp as the latest plunge has been, it is but a step on the semiconductor giant’s downward ladder. Indeed, the chipmaker’s equity is 25.82% in the red year-to-date (YTD) and is changing hands at $99.62 at press time in the April 4 pre-market.
Wall Street downgraded Nvidia stock price target
Under the circumstances, it is hardly surprising that HSBC’s Frank Lee elected to downgrade NVDA stock from a ‘buy’ to a ‘hold’ while lowering the price target from $175 to $120.
In Lee’s assessment, Nvidia is deserving of a downgrade due to a lack of notable increase in the GPU pricing power between recent architectures and due to the next increase in the GPU headcount coming only with the Rubin Ultra, scheduled for 2027.
Why Nvidia stock could collapse in 2025
Though not explicitly mentioned, some of the chipmaker’s other woes could also limit the upside. Nvidia’s production capacity has not been on par with the demand for Blackwell, potentially costing the firm market share.
Simultaneously, the semiconductor giant could become subject to a regulatory crackdown in the Chinese market due to how power-hungry the new hardware is. However, Jim Cramer has voiced the common doubt about Beijing truly banning technology it likely can’t replace over environmental concerns.
Lastly, pricing, supply, and demand could become an even greater issue for Nvidia should the current fears that the data center infrastructure boom – a major source of orders for the blue-chip chipmaker – has become a bubble prove clairvoyant.
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