TLDR
- NVIDIA stock plunged over 7% on Friday as part of a broader tech selloff
- The decline was triggered by escalating trade war tensions between the US and China
- NVIDIA had previously reported record Q4 revenue of $39.3 billion, up 78% year-over-year
- The company’s Blackwell architecture achieved $11 billion in Q4 revenue, its fastest product ramp in history
- Tech stocks including NVIDIA have shown warning signs even before the trade war, with late-stage base patterns indicating higher risk
NVIDIA Corporation (NASDAQ) shares tumbled more than 7% on Friday, contributing to a broader tech sector collapse that pushed the Nasdaq into bear market territory.
The dramatic decline came as a direct response to growing trade war tensions between the United States and China.
The chipmaker’s stock finished at $94.31, dropping $7.49 in a single trading session. After-hours trading saw a further decline of 0.49% to $93.85.
NVIDIA wasn’t alone in its troubles. Other “Magnificent Seven” tech stocks suffered similar fates, with Tesla falling over 10%, Apple dropping 7%, and Meta losing more than 5%.
The selloff intensified after China announced retaliatory tariffs against the US. This move came in response to President Trump’s sweeping levies on imports that brought China’s tariff rate to 54%.
Rising Trade Tensions
Wall Street analysts have been sounding alarms about potential economic fallout from the trade dispute. Many are warning of a possible global recession if these tariffs remain in place.
Wedbush analyst Dan Ives didn’t mince words in his Friday note to investors. “The concept of taking the US back to the 1980’s ‘manufacturing days’ with these tariffs is a bad science experiment that in the process will cause an economic Armageddon in our view and crush the tech trade, AI Revolution theme, and overall industry in the process,” he wrote.
Treasury Secretary Scott Bessent defended the administration’s position in an interview released Friday. “The markets go up and down,” Bessent remarked, suggesting the decline began earlier with Chinese AI announcements rather than US economic policies.
The market briefly rallied Friday morning after Trump indicated Vietnam was seeking to reduce its tariffs to zero in a potential deal with the US. This momentary relief proved short-lived as stocks closed near session lows.
NVIDIA’s Recent Performance
Before this market turbulence, NVIDIA had been riding high on exceptional financial results. The company reported record Q4 revenue of $39.3 billion, representing a 12% sequential increase and a 78% year-over-year jump.
For fiscal 2025, NVIDIA achieved total revenue of $130.5 billion, marking a stunning 114% increase from the prior year. Data Center revenue was particularly impressive at $115.2 billion for fiscal 2025, more than doubling from the previous year.
The company’s Blackwell architecture has been a standout success story. It generated $11 billion in revenue during Q4 alone, marking the fastest product ramp in NVIDIA’s history.
Management had projected strong growth for 2025, with expected Q1 revenue of $43 billion, driven by Blackwell ramp-up and sequential growth in both Data Center and Gaming segments.
Technical Warning Signs
Even before the trade war escalation, NVIDIA was showing warning signs typical of a stock that had made a major run. According to market analysts, NVIDIA’s last two breakouts came from late-stage bases, which typically carry higher risk.
Late-stage patterns often form after a stock has already made a big move, making it more vulnerable to seesaw volatility. This technical pattern was evident even before President Trump’s tariffs rattled Wall Street.
NVIDIA’s meteoric rise—up 1,202% from its October 2022 low until its record high in June last year—made the stock particularly sensitive to market shifts. Its May breakout came from a third-stage base, while a subsequent October breakout to another all-time high emerged from a riskier fourth-stage pattern.
These technical factors have combined with the broader market pressures to create a perfect storm for NVIDIA and other tech stocks. Investors who follow technical analysis have been watching these patterns closely.
The January release of Chinese startup DeepSeek’s AI chatbot had previously sent shares of NVIDIA lower as investors questioned high valuations and AI spending levels.
By the end of Friday’s trading, NVIDIA had fallen double-digit percentages for the week, along with Meta and Apple.
