Nvidia Sinks on AI Chip Delay, But is the Stock a Sell?

Shares of market bellwether Nvidia (NVDA) are down 28.6% from all-time highs, valuing the chip designer at a market cap of $2.47 trillion. The semiconductor giant has been feeling the heat in recent trading sessions as investors worry about the possibility of a recession in the U.S., interest rate hikes in Japan, and geopolitical tensions. 

In addition to macroeconomic factors, weekend reports indicated that Nvidia's next-generation artificial intelligence (AI) chips will be delayed by three months, and mass shipments will begin in early 2025. The delay has been attributed to a design flaw in its next-gen chips uncovered late in the production process. Earlier this year, Nvidia unveiled its Blackwell (B200) line of chips, which performs AI tasks at twice the speed while using less energy.