Nvidia just took a massive hit, erasing $450 billion in market value in the last 24 hours, according to data from Google Finance, down from the $3 trillion valuation that made it the most valuable company on the planet.
The company had just reported record-breaking earnings, raking in $39.3 billion in revenue for the quarter, yet the stock still plummeted 8.5% on Thursday.
Jensen Huang, Nvidia’s co-founder and CEO, personally lost $9.5 billion in a single day. His net worth now stands at $150.1 billion, according to Forbes’ real-time billionaire ranking. Huang owns about 3% of Nvidia.
Stock crash despite record earnings
Even though Nvidia’s earnings smashed estimates, the company’s first-quarter gross margin forecast left investors unimpressed. Nvidia projected a gross margin of 71%, down from 73% last quarter and below Wall Street’s target of 72.1%, which, of course, triggered an immediate sell-off.
Despite concerns, Nvidia beat expectations in nearly every other category. Revenue for the quarter hit $39.3 billion, surpassing projections, and earnings per share landed at $0.89, also well above estimates.
The company also raised its guidance for the next quarter, predicting $43 billion in revenue, slightly above analysts’ forecasts of $42.3 billion.
JPMorgan analyst Harlan Sur told CNBC that Nvidia is now dealing with rising costs and expedited fees as it ramps up shipments of its new Blackwell AI chips. These GPUs are in high demand, but higher expenses are cutting into profit margins.
The S&P 500 closed down 1.59% at 5,861.57. The broad market index remains in the red for the week and month. The Nasdaq Composite pulled back 2.78% to end the day at 18,544.42, with Nvidia’s 8.5% slide pulling the tech-heavy index lower. The Dow Jones Industrial Average lost 193.62 points, or 0.45%, to finish at 43,239.50.
Other major tech stocks also took a hit amid the broader sell-off. Tesla dropped 3%, extending its year-to-date losses to 30%. Apple, Microsoft, Amazon, Alphabet, and Meta all retreated, with the entire tech sector struggling against investor uncertainty.
Adding to the problems, President Donald Trump announced that new tariffs on Mexico and Canada will take effect on March 4, after a one-month moratorium. He said on Truth Social that a 25% tariff would be imposed, claiming the countries had not done enough to curb drug trafficking over the border. He also warned that China would soon face an additional 10% tariff on top of existing trade restrictions.
Beyond trade policy, rising jobless claims have also weighed on investor sentiment. According to the Labor Department, jobless claims for the week ending February 22 rose to 242,000, up by 22,000 from the week before and well above the 225,000 expected by economists.
Traders are now focused on Friday’s personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation measure, which will provide new insight into where inflation is heading.
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