Nvidia Down 20% for 2025 So Far
Nvidia stock is falling still, affected by new competition in China, tariff fears, and high costs for shipping chips to China.
Quick overview
- Nvidia's stock has dropped about 20% in 2025, falling from $144 in January to $106.
- The decline is primarily due to U.S. government restrictions on selling powerful AI chips to China, a key market for Nvidia.
- Increased competition from Chinese companies like Huawei and ongoing tariffs have further impacted Nvidia's market share and profitability.
- Despite a temporary pause on tariffs, Nvidia faces significant challenges that may prolong its stock decline throughout 2025.
In 2023 and 2024, Nvidia (NVDA) shot up the stock market charts and outperformed most other tech stocks, but it has had an abysmal 2025 so far, losing about 20% of its value.
A number of factors have worked against Nvidia in 2025 to bring its stock price down from $144 in January to its current value of $106. While the stock price for this tech company may be up 0.27% today, it has declined sharply through the first few months of the year.
What Is Driving Nvidia’s Price Down?
Nvidia has suffered primarily this year due to selling restrictions placed on it by the United States government. Many of Nvidia’s most powerful AI chips are not allowed to be sold to China, as the United States is trying to prevent the competing nation from surpassing it in this tech niche. However, China is a massive market for Nvidia, and the company has been selling less powerful chips there as a way around the current restrictions.
Because U.S. law keeps Nvidia from being as competitive as it could be in that market of more than one billion people, there is room for other tech companies to step in and pull Nvidia’s market share away from them. That is exactly what looks to be happening as Chinese tech company Huawei is preparing to launch the Ascend 920 chip that will compete directly with Nvidia’s H20 chip that is currently being sold in China. This news has caused Nvidia’s stock price to plummet recently.
Nvidia has also been hurt by the steep fines they are paying to bring some for their chips to the Chinese market, but they are committed to meeting market demands there despite the high costs to them. Nvidia has been hurt by recent tariffs as well, and the company was recently the subject of a Chinese government inquiry into monopolistic business practices.
Can Nvidia Pull Its Stock Value Back Up?
Nvidia could benefit from the pause placed on tariffs over the next three months, giving it some room to breathe and get back on its feet. There is still the issue of the Chinese market potentially going in large part to a competitor. That would be a major loss for Nvidia.
Nvidia reported that for 2024 it made $17.1 billion in revenue from the Chinese and Hong Kong markets. That accounts for about 13% of its overall revenue, so losing that market would be catastrophic at a time when the company is already struggling.
It does not look like Nvidia will be pulling out of the decline anytime soon, though, since premarket trading for Wednesday has its stock price dropping 3.57% already. Investors should prepare for more rough patches in 2025 as Nvidia weathers tariffs, stiff competition, and rising costs.
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