TLDR
- Nvidia (NVDA) closed at $229.28 on Friday, down $1.20 or 0.52%, its fourth straight daily decline.
- The Financial Times reports Nvidia is in early talks to buy Reflection AI or raise its stake.
- Nvidia has already committed $800 million to Reflection, which was last valued at $25 billion pre-money.
- Several Nvidia-backed stocks are falling, including SoundHound, Arm and CoreWeave.
- A rising wedge on the chart points to $210 as the downside target, while $243 is the key resistance.
Nvidia (NVDA) stock closed at $229.28 on Friday, down 0.52%. That marks a fourth straight daily drop, and the stock now sits about 6% below its all-time high of $243.
The Financial Times reported Saturday that Nvidia is in early talks to acquire Reflection AI. The chipmaker could also choose to raise its existing investment in the startup. People familiar with the matter said a deal could come within weeks.
The talks are preliminary and could fall apart. Reuters said it could not verify the report. Neither company has commented.
Nvidia could structure the deal in a few ways. Options include a full buyout, more funding, or an acqui-hire where it brings on staff and licenses the technology. An acqui-hire can help a buyer avoid the long regulatory reviews that come with a traditional takeover.
Nvidia already has skin in the game. The FT says it has committed $800 million to Reflection so far.
What Reflection AI does
Reflection was founded in 2024 by former Google DeepMind researchers Misha Laskin and Ioannis Antonoglou. It builds tools that automate software development.
In April, Laskin told CNBC the company was raising money at a $25 billion pre-money valuation. A buyout price would likely come in well above that figure.
Reflection also launched its first open-weight model, Beam, on Monday. It targets coding and agent tasks and is meant to compete with cheaper Chinese options such as DeepSeek and Kimi.
An acquisition would be Nvidia’s biggest yet. It would come weeks after the company agreed to buy Hugging Face in a deal valued at over $13 billion.
The acqui-hire route has drawn some heat before. Nvidia used that approach with Groq, and Groq’s employees sued last week, saying they were undercut.
Nvidia’s portfolio is under pressure
The news lands as several Nvidia-backed stocks struggle. SoundHound AI has fallen to its lowest level since 2014. Marvell has dropped to $275 from a record of $329.
Arm Holdings is down more than 46% from its peak. Neocloud names like IREN, CoreWeave and Nebius have also fallen. Australian firm Firmus postponed its IPO last week after investors balked at its valuation.
OpenAI, another big Nvidia investment, is also behind plans. Its annualized revenue of about $50 billion is $20 billion below what analysts expected.
Not every holding is struggling. Lumentum hit a record $1,140 after management said its products are sold out through 2029.
Chart analysis
Nvidia’s daily chart shows a rising wedge, with two upward trendlines that are drawing closer together. The stock topped out near $243 at the upper line and has now slipped back toward the middle of the pattern. It still trades above its 50-day and 100-day moving averages, which keeps the longer uptrend in place. Support sits near $220, with resistance around $233 to $237.
The RSI has cooled to about 53 from near 68 in early October, which shows buying momentum has faded without hitting oversold levels. The MACD reads 3.95 against a signal line of 3.82, and the histogram has narrowed to 0.13. That suggests the bullish momentum is close to flipping.
What to watch: a break below the lower wedge line near $220 could open the door to $210, the September 14 low. Holding above it keeps the uptrend structure intact, and a move over $243 would point to fresh highs.
The next few weeks bring earnings from big Nvidia customers, including Microsoft, Alphabet, Meta Platforms and Amazon. Nvidia stock ended Friday at $229.28 and edged up to $229.33 in after-hours trading.
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