By Nvidia stock climbed in early trading on Monday, recovering some losses after recent weakness tied to growing competition in the artificial intelligence chip market.
The Nvidia stock gained 1.9% to $170.24 after falling 2.7% on Friday.
Other chipmakers showed mixed moves, with Advanced Micro Devices down 0.6% and Broadcom up 4.7%.
The S&P 500 rose 0.2% on Monday as investors positioned for a data-heavy week, with two closely watched inflation readings due.
Nvidia shares have declined about 8% over the past month through Friday’s close.
The selloff followed the company’s earnings report and was further pressured by Broadcom’s results, which suggested its clients plan to increase reliance on Broadcom’s hardware at the expense of Nvidia’s graphics processing units.
Citi lowers price target
Citi analyst Atif Malik maintained a buy rating on Nvidia but trimmed his price target by $10 to $210.
The revised target still implies a potential upside of nearly 20% from Friday’s close.
Malik’s adjustment reflects expectations of weaker GPU sales in 2026, citing competitive pressure from Broadcom and Google’s tensor processing units.
Malik said he now anticipates Nvidia’s 2026 GPU sales to be about 4% lower than previously estimated, implying a potential revenue impact of roughly $12 billion.
He noted that Broadcom’s quarterly results, which included a $10 billion order of custom AI chips from an undisclosed customer, reinforced the shift toward broader adoption of XPU architectures.
Nvidia’s competition
Nvidia currently controls about 90% of the AI chip market, but rivals are intensifying their efforts.
Malik highlighted that Google’s tensor processing units are increasingly competing with Nvidia’s GPUs, particularly as the search giant offers compute capacity to technology firms such as Meta, OpenAI, and Oracle.
Melius Research analyst Ben Reitzes wrote that Nvidia’s market share was always expected to decline over time.
He projected that Broadcom could capture about 30% of the market, with AMD and other chipmakers collectively taking at least 10%.
Other challenges for the AI darling
Nvidia’s stock has faced pressure not only from competitive threats but also from concerns about customer concentration.
In the July quarter, the company’s top two customers accounted for 39% of total revenue.
Second-quarter data centre revenue also grew less than anticipated, weighing further on sentiment.
Malik said his calendar year 2025 and 2026 estimates for Nvidia remain slightly above consensus, supported by expected growth from neocloud providers and sovereign AI initiatives, where governments invest in building domestic AI infrastructure.
His estimates exclude potential upside from China, which could materialise if Nvidia resumes GPU shipments to the country.
The next major catalyst for Nvidia is CEO Jensen Huang’s keynote address at the company’s GTC conference scheduled for October 28.
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