Nvidia (NASDAQ: NVDA) shares have lagged behind the S&P 500 by 9% over the past month as investors reacted to Chinese AI startup DeepSeek’s entry into the market. However, analysts at Evercore ISI believe the pullback presents a strong buying opportunity ahead of Nvidia’s upcoming earnings report.
Why Did Nvidia Stock Decline?
? DeepSeek’s AI Innovation: Concerns emerged that DeepSeek’s custom AI chips could erode demand for Nvidia’s GPUs.? Shift to ASICs: Speculation about AI companies moving from Nvidia GPUs to ASICs (Application-Specific Integrated Circuits).? Blackwell Delays: Uncertainty around the release timeline of Nvidia’s next-gen Blackwell architecture.
Why Evercore Remains Bullish on Nvidia
? DeepSeek’s Tech Is Evolutionary, Not Disruptive
Evercore’s channel checks with AI engineers suggest DeepSeek’s advancements provide incremental cost savings rather than a game-changing breakthrough.
Lower computing costs are expected to increase AI adoption, ultimately driving more demand for Nvidia’s GPUs.
? Nvidia’s Software Ecosystem Gives It an Edge
Nvidia remains years ahead of rivals like AMD (NASDAQ:AMD) and AWS due to its strong CUDA software stack and developer support.
AI firms rely on Nvidia’s software tools, such as NIMS and NeMo, to train and deploy Large Language Models (LLMs) seamlessly across different computing environments.
? ASICs Won’t Replace Nvidia’s GPUs Anytime Soon
While ASICs offer powerful, specialized AI computing, Nvidia’s programmable GPUs remain essential for flexible AI model training and inference optimizations.
Innovations like LiquidAI, which train models during the inference process, make Nvidia’s GPUs indispensable for cutting-edge AI development.
The Road Ahead: Nvidia’s Earnings & Market Outlook
? Nvidia’s quarterly results are due on February 26.? Analysts will closely watch revenue growth, AI chip demand, and updates on Blackwell’s rollout.? Will Nvidia’s earnings reaffirm its dominance, or will AI competition weigh further on its stock?
? Track Nvidia’s Market Trends With:
? Market Biggest Gainers API – Stay ahead of Nvidia’s stock movements and market leaders.? Earnings Calendar API – Get real-time earnings reports and analyst expectations.
With AI demand accelerating, Nvidia’s software moat and ecosystem strength could keep it at the forefront of the AI race.
