Actions of semiconductor giant Nvidia (Nasdaq: NVDA) jumped 18.7% on April 9, after President Trump announced a 90 -day break on the higher “reciprocal prices”. Instead, he authorized a “reciprocal rate lowered by 10%” – in accordance with the reference rate of 10% on all imports.
Investors have long been concerned about the American government’s decision to impose import rates on products from various business partners. Since this can result in an increase in costs, disruptions of the supply chain and reprisals on American products, many American actions experienced a spectacular drop in early April 2025. The temporary break in reciprocal prices seems well received by Wall Street.
Nvidia’s shares are down almost 25% compared to its recent summit in January 2025. Although this is not a very encouraging sign, this is a solid improvement compared to the draw of almost 38% compared to High on April 4.
So, does the correction of the evaluation have an opportunity for investors to buy, have or sell Nvidia shares now? Discover.
Regulatory risks have become a primary headwind for NVIDIA. In April 2025, the United States government announced its decision to take a 32% tariff on Taiwan imports and a 34% rate of China. China responded by taking 84% of reprisals on imports from the United States in retaliation, the US government has increased the prices on Chinese imports to 104%.
Although semiconductors have been excluded from this tariff cycle, there are signals from a potential climbing of trade wars between the United States and China.
Jefferies Analysts fear the possibility of additional sectoral prices, including semiconductors, in subsequent tariff cycles. If it is true, this can cause significant disruptions of the supply chain and margin pressures for Nvidia, since the company depends Taiwan semiconductor manufacturing Fabs for the manufacture of fleas.
The US government has long been thinking about stricter controls on flea sales in China. Recently introduced energy efficiency guidelines by the Chinese government also urged businesses to use fleas adhering to strict requirements in new data centers or extensions. Given that the best -selling NVIDIA h20 chip does not meet these requirements, it can harm the Chinese activities of the company – representing almost 13% of its income during the 2025 financial year (ending on January 26).
Nvidia also meets competitive pressures, although other flea manufacturers are considerably late in the breed of artificial intelligence (IA). The company also experiences gross margin pressures in the short term due to the rise of its Blackwell systems.
Despite these challenges, several catalysts can increase the prices of NVIDIA shares in the coming months.
Nvidia enjoys an unequaled technological advantage in AI computer science, which is obvious given its part of more than 90% on the GPU AI market. The company has developed a robust IA infrastructure optimized for several IT IT workloads with significant growth opportunities. These include scaling or building and upgrading of fundamental models with large quantities of multimodal data, post-training scaling or personalization and fundamental models of fine adjustment, and inference, including complex reasoning.
Recently launched Blackwell architecture systems have been specially architects for inference workloads (deployment and execution of models in a real -time environment) in various deployment environments such as on site, cloud or hybrid. Blackwell is also optimized for the workload workloads rich in calculation, demonstrating a token flow rate 25 times higher and a cost 20 times lower than that of the Hopper 100 chips. Therefore, with the demand for a business which is increasingly passing from the workload to more recurring workloads, Blackwell should continue to be a significant growth catalyst for Nvidia.
In addition to the equipment, NVIDIA has built a solid software ecosystem with more than 5.9 million developers using the unified device architecture (CUDA) and other software platforms. The company has also recently introduced software offers such as Nvidia Ai Enterprise and Nvidia inference microservices to allow companies to effectively deploy AI solutions. This software advantage has resulted in high switching costs, which resulted in a sticky clientele.
Finally, the rapid adoption of AI and robotics agents is also a significant growth avenue for Nvidia. Blackwell fleas are ready to benefit from the opportunity to evolve AI, because it has the computing power and the low latency required for the construction of systems capable of making complex decisions and planning.
NVIDIA is negotiated the profits at 24.45 times, much lower than its average over five years of 71.54x. Consequently, it is obvious that most risks are already evaluated during the action of the company.
But Nvidia also has a history of rebound considerably after deep falls. Some of the recent events can better highlight this trend.
This was observed in 2018, when the stock dropped by more than 53% of its peak in early October 2018 in late December 2018. The decline was mainly due to the cryptography market in the middle of world technological sales, resulting in an accumulation of excess stocks for NVIDIA. However, the action was recovered by more than 65% in 2019, after the normalization of inventory levels and that sales in the game and data centers segments began to show a strong dynamic.
Nvidia’s actions also dropped 30% compared to its recent summit in February 2020 to its hollow in March 2020 due to the uncertainty of the market and the disturbances of the supply chain at the first stages of the COVVI-19 pandemic. However, by March 2021, the stock had climbed more than 100%, mainly by an increased demand for games and data centers during the pandemic.
Finally, the Nvidia stock crashed almost 66% from November 2021 In mid-October 2022, due to concerns concerning the increase in interest rates and disturbances of the supply chain. But then, the stock had recovered more than 200% by October 2023, fueled by the explosive demand on the AI markets and data centers and the emphasis put by the company innovation.
Consequently, historically, Nvidia returned even stronger within 12 months after a significant drop in stock. Consequently, it is logical for retail investors to acquire at least a small participation in this stock to benefit from its future growth prospects.
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Manali Pradhan Has no position in the actions mentioned. The Motley Fool has positions and recommends Jefferies Financial Group, Nvidia and Taiwan Semiconductor Manufacturing. The Word’s madman has a Disclosure policy.
NVIDIA shares are down 25% compared to 52 weeks – should you buy, hold or sell now? was initially published by the Motley Fool
